Answer the following statements true (T) or false (F)
1. The "principal-agent problem" often arises in public choice when politicians pursue the best interests of their constituents.
2. In thinking about the "principal-agent problem" in a democratic government, we assign the role of "principal" to the government.
3. The special interest effect in government is the reason why firms in some industries are willing to pay huge amounts of money to lobbyists.
4. When the special-interest effect is the major reason for the passage of a government policy or project, then economic efficiency will always improve.
5. The "pork" in pork-barrel politics refers to government projects that politicians try to secure in favor of the common good for the whole nation.
1. FALSE
2. FALSE
3. TRUE
4. FALSE
5. FALSE
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How can the influence of a third variable be shown on a two-dimensional graph?
A) by allowing the position of the relationship line or curve to shift on the graph B) by super-imposing the third variable on the two-dimensional graph C) by drawing a third axis coming out of the two axes D) by allowing the relationship to be nonlinear
In an hour Jane can solder 50 connections or inspect 20 parts while Jim can solder 25 connections or inspect 20 parts in an hour
A) Jane has a comparative advantage over Jim in both soldering and inspecting. B) Jane has a comparative advantage over Jim in soldering while Jim has a comparative advantage in inspecting. C) Jim has a comparative advantage over Jane in soldering while Jane has a comparative advantage in inspecting. D) Jim had a comparative advantage over Jane in both soldering and inspecting.
Professor Cowen suggests that gift-giving can create value for each of the following reasons EXCEPT:
A. gift-giving can lower search costs. B. some gifts are given for paternalistic reasons. C. gifts can signal our values or intentions. D. the cost of the gift for the recipient is zero.
The Temporary Assistance for Needy Families (TANF) program _____.
(A) Provides benefits to a family for ten years. (B) Can only provide jobs for individuals in an enterprise zone. (C) Only provides cash assistance to poor families. (D) Provides work in exchange for temporary assistance.