If the quality or quantity of a particular public service is very difficult to monitor, government is more likely to
a. produce the service itself
b. contract with private firms to supply the service
c. take over private corporations to produce the service
d. refuse to provide the service
e. raise the price to consumers of the service
A
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In the traditional Keynesian model, an increase in government spending leads to all of the following EXCEPT
A) a higher price level. B) an increase in aggregate demand. C) an increase in consumption. D) higher real GDP.
In the early 1950s, economist William Baumol demonstrated that a lower interest rate ________ the demand for money in a model without bond speculation ________ a "broker's fee" for conversions between money and bonds
A) raises, and without B) raises, but with C) lowers, and without D) lowers, but with E) does not affect, and without
A decrease in the price of leather used to make shoes would cause the
a. demand for shoes to decrease. b. demand for shoes to increase. c. supply of shoes to decrease. d. supply of shoes to increase.
Which of the following statements is not correct?
a. A seller would be eager to sell her product at a price higher than her cost. b. A seller would refuse to sell her product at a price lower than her cost. c. A seller would be indifferent about selling her product at a price equal to her cost. d. Since sellers cannot set the price for their product, they must be willing to sell their product at any price.