The problem of limited and bundled choice in the political process tends to
1. The problem of limited and bundled choice in the political process tends to
a. increase economic efficiency, because politicians choose programs with positive and negative net benefits.
b. reduce economic efficiency, because politicians choose programs with positive and negative net benefits.
c. increase economic efficiency, because politicians choose programs with average net benefits.
d. reduce economic efficiency, because politicians choose programs with average net benefits.
2. Public bureaucracies are possibly less efficient than business firms because
a. the private market is driven by profit, but this competitive force does not operate in public bureaucracies.
b. the private market has more resources than public bureaucracies.
c. the private market has access to better technologies than public bureaucracies.
d. workers in public bureaucracies have less supervision and shirk their responsibilities.
Answer: 1. b. reduce economic efficiency, because politicians choose programs with positive and negative net benefits.
2. a. the private market is driven by profit, but this competitive force does not operate in public bureaucracies.
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According to the infant industry argument for trade protectionism
A) new industries are capable of competing with established rivals. B) trade barriers must be used to protect domestic workers. C) new industries need to be shielded from competition in the early stages of learning by doing. D) tariffs imposed to aid new industries should never be removed.
If the prices of domestic consumer goods increased while the prices of imported consumer goods decreased, and the demand for each remained the same, which of the following would most likely occur?
a. The GDP price index would decrease while the CPI would increase. b. Both the GDP price index and the CPI would decrease. c. The GDP price index would increase more than the CPI. d. The CPI would increase more than the GDP price index. e. Both the GDP price index and the CPI would increase by the same amount.
If the price of potatoes is reduced, consumers likely:
a. significantly more potatoes b. significantly fewer potatoes c. roughly the same quantity of potatoes d. an unknown quantity of potatoes; in this situation, consumers' actions cannot be predicted
In foreign-exchange markets, reporting dealers trade more foreign exchange with other reporting dealers than with any other category of users.
a. true b. false