Which of the following statements refers to rent seeking?
A) "The role of the federal government in the U.S. economy grew significantly after the Great Depression. Government spending and taxes are a much greater proportion of total income today than they were in 1929."
B) "Laws passed by the federal government often provide benefits for a small number of individuals. These individuals, in turn, have an incentive to contribute to the campaigns of politicians who pass these laws."
C) "The federal government should spend more money on programs that help low income citizens and less money on national defense."
D) "There is an opportunity cost whenever the federal government spends tax revenue. For example, an additional $1 billion spent on national defense means there will be less revenue for highway construction and maintenance or some other program."
B
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Refer to Figure 2-3. Sergio Vignetto raises cattle and llamas on his land. A portion of his land is more suitable for raising cattle, and the other portion is better suited for raising llamas
Which of the graphs in Figure 2-3 represent his production possibilities frontier that displays increasing opportunity costs? A) Graph A B) Graph B C) Graph C D) either Graph A or Graph C E) either Graph B or Graph C
If producers who hire labor in a competitive labor market decide to purchase the new automated machine that completes the work of 30 employees, we would expect the labor-demand curve to shift to the:
A. left and wages would rise. B. left and wages would decrease. C. right and wages would rise. D. right and wages would decrease.
When the supply curve of land is upward sloping and intersects the demand curve at $30 per acre, then the last acre brought into production receives
a. $30 in land rent b. $0 in land rent c. average land rent of somewhere between $0 and $30, depending on the price of land d. land rent equal to the price of an acre of land e. land rent greater than $30 because the last acre is located to the right (in the land market graph) of the intersection of the demand and supply curves
The table below shows the marginal benefit and marginal cost of purchasing an additional unit of 3 different public goods. Marginal benefitMarginal costTotal spending on the public goodPublic good 1$20$20$1,500Public good 2$15$25$800Public good 3$10$5$700 The government is spending the socially optimal amount on:
A. public good 3. B. public good 1. C. public good 2. D. public good 1 and public good 2.