Which of the following factors weakens the case for government provision of goods and services relative to private-sector provision?
a. monopoly
b. externalities
c. public goods
d. the special-interest effect
D
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Which of the following statements regarding principal-agent relations is CORRECT?
A) Workers are principals for managers. B) Stockholders are agents. C) Managers are both principals and agents. D) All of the above answers are correct.
Many people buy fire insurance when they are not required to do so. What does this tell you about their risk preferences?
What will be an ideal response?
Which one of the following statements is true?
a. Resources flow from the government to firms. b. Taxes flow from foreign economies to the government. c. Goods and services flow from households to foreign economies. d. Resources flow from households to firms. e. Resource payments flow from households to the government.
Figure 4-17
Refer to . Suppose a price ceiling of $4.50 is imposed. As a result,
a.
there is a shortage of 15 units of the good.
b.
the demand curve will shift to the left so as to now pass through the point (Q = 35, P = $4.50).
c.
the situation is very much like the one created by a binding minimum wage.
d.
the quantity of the good that is bought and sold is the same as it would have been had a price floor of $7.50 been imposed.