Public choice theory indicates that the behavior of people in government
a. differs from the behavior of people in the private sector because they are motivated by the public interest rather than their own personal self-interest.
b. differs from the behavior of people in the private sector because public sector decision roles do not allow people to pursue their own self-interests.
c. is the same as people in the private sector only if decisions are made by majority vote.
d. is best understood by applying the same principles we use to predict the behavior of people in the private sector.
D
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Suppose Kate's Great Crete (KGC) has annual variable costs of VC = 30Q + 0.0025Q2 and marginal costs of MC = 30 + 0.005Q, where Q is the number of cubic yards of concrete it produces per year. In addition, it has an avoidable fixed cost of $50,000 per year. KGC's demand function is Qd = 20,000 - 400P. What is KGC's total cost function?
A. TC = 50,030 + 30.005Q + 0.0025Q2 B. TC = 50,000 + 50Q - 0.0025Q2 C. TC = 20,000 - 400P D. TC = 50,000 + 30Q + 0.0025Q2
Which of the following is an example of a backward linkage?
a. A car industry creates a need for car dealerships. b. A compact disc industry creates a need for CD players. c. The development of a shoe industry creates a demand for a leather industry. d. An increase in the population increases the demand for food. e. New educational facilities improve the literacy rate of the population.
The existence of an inflationary gap should cause
a. wages to fall. b. prices to fall. c. unemployment to rise. d. net exports to rise.
A firm employing 100 workers has an average absenteeism rate of 4%. On a given day, what is the probability of
(a) no workers, (b) one worker, (c) more than six workers being absent?