When the federal government becomes heavily involved in programs that favor well-organized business interest at the expense of others, the expected result is
a. more rapid economic growth, because programs of this type are generally productive.
b. a reduction in rent seeking activities because political decision-makers will want to promote smaller, innovative firms rather than large firms that are a major source of political contributions.
c. less innovation because political decision-makers will tend to favor older firms with a stronger record of providing political support rather than newer, innovative start-up firms.
d. a decline in the competitiveness of elections, because politicians will find it more difficult to raise campaign contributions.
Answer: c. less innovation because political decision-makers will tend to favor older firms with a stronger record of providing political support rather than newer, innovative start-up firms.
You might also like to view...
Suppose inflation is expected to be 5 percent next year, and you and your employer agree to a 6 percent increase in your nominal, or monetary, wage. If inflation turns out to be 5%, what is your nominal wage increase?
Growth in GDP systematically understates the growth in national well being because
a. ecological costs are netted out of GDP. b. "bads" as well as "goods" get included in GDP. c. investment is not included in GDP. d. as a country gets richer, leisure time increases.
Economists at the Congressional Budget Office estimated that for 2015, the U.S. natural rate of unemployment was about 4.9 percent
a. True b. False Indicate whether the statement is true or false
In a certain economy, the components of planned spending are given by:C = 500 + 0.8(Y - T) - 300rI P = 200 - 400rG = 200NX = 10T = 150 Given the information about the economy above, which expression also states planned aggregate expenditure (PAE)?
A. [910 ? 700r ] B. [790 ? 700r ] + 0.8Y C. [790 - 700r ] D. [910 ? 700r ] + 0.8Y