Government officials tend to make:
A. better economic decisions than private individuals because of the wealth of information at
their disposal.
B. better economic decisions than private individuals because of the efficient processes and
flexibility built into the government bureaucracy.
C. inefficient choices because they lack the information necessary to accurately weigh
marginal benefits and marginal costs.
D. inefficient choices because the invisible hand directs them away from the resource
allocation where marginal benefits equal marginal costs.
Answer: C
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As the number of firms in a market increases, the supply curve will shift to the right and the equilibrium quantity will rise
Indicate whether the statement is true or false
Dissaving occurs when:
a. disposable income is greater than consumption. b. consumption is greater than disposable income. c. consumption is equal to disposable income. d. consumption is greater than personal income. e. consumption is less than personal income.
Monetary
What will be an ideal response?
If Iowa's opportunity cost of corn is lower than Oklahoma's opportunity cost of corn, then
a. Iowa has a comparative advantage in the production of corn. b. Iowa has an absolute advantage in the production of corn. c. Iowa should import corn from Oklahoma. d. Oklahoma should produce just enough corn to satisfy its own residents' demands.