If a city government spends a good deal of money on crime prevention and also on infrastructure maintenance, then spending even more money on crime prevention should result in
A. significant gains in crime prevention.
B. significant gains in infrastructure maintenance.
C. relatively small gains in crime prevention.
Ans: c. Relatively small gains in crime prevention.
Explanation: When the government is already spending a good amount of money in crime prevention, any extra spending will result in reduction of the crime but by a lesser amount. Which can be termed as less effective. In begining, when the crime rate is high, small amount of spending on crime prevention result in the reduction of the crime rate. Now, with every additional unit of the spending on crime prevantion will result in lesser and lesser amount of reduction in crime rate. On the other hand this act will reduce the expenditure on infrastructure.
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Statistical data provided by the U.S. Department of Transportation shows that the median income of individuals traveling on the nation's bus systems is $18,000 compared to $65,000 for those who normally travel by air. This finding is best explained by which of the following statements?
a. Persons with high income are more likely to fly because the opportunity cost of their time is generally higher than those with lesser income. b. Traditionally, lower income groups prefer slower methods of transportation. c. Wealthy individuals own stock in the airlines and, therefore, receive preferential treatment. d. Low-income groups are generally located near bus stations; wealthy groups congregate around airports.
The three major differences between tariffs and trade quotas are (1) __________________; (2) ________________; and (3) _________________.
Fill in the blank(s) with the appropriate word(s).
Which of the following is most likely an example of the division of labor?
a. It is easier to be a wheat farmer in North Dakota than in Florida. b. If you live in or near a big city, it is easier to attract enough customers to operate a successful dry cleaning business or movie theater than if you live in a sparsely populated rural area. c. A restaurant divides up the task of serving meals into a range of jobs like top chef, sous chefs, less-skilled kitchen help, and servers to wait on the tables. d. Only those with medical degrees qualify to become doctors.
Demand for inputs is a derived demand because
a. it is derived from the need for income. b. it corresponds to the derived supply of the inputs. c. producers want the input to produce the finished good. d. it is downward sloping.