An understanding of the principles of public sector economics can help us create _____
a. innovative public policies
b. a more effective government
c. a protective government that better shields its citizens from risk
d. new spending programs
b
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If real GDP per person rises above the subsistence level then, according to classical growth theory,
A) a population explosion will occur. B) labor productivity growth permanently increases. C) population growth will slow down. D) real GDP per person will fall below the subsistence level. E) real GDP per person will remain above the subsistence level.
When the supply of a good is perfectly elastic, the entire tax is paid by the buyers
a. True b. False Indicate whether the statement is true or false
It is argued that competitive markets provide a "natural remedy" to discriminatory wage practices. Which of the following is widely recognized as a potential limit to the potency of that natural remedy?
a. Governments sometimes mandate discriminatory practices. b. Some employees have a lot of job experience; others have little job experience. c. In a discriminatory environment, a competitive firm that takes prices and wages as given has nothing to gain from any particular choice it makes regarding who to hire or which customers to serve. d. Not all firms exhibit social responsibility in sufficient measure to counter discriminatory wage practices.
The interest rates on outstanding credit card balances are generally high because
A) the default rate on credit card loans is high and there are no assets backing these loans. B) the banks "price gouge" consumers in this market. C) there is little competition in this lending market. D) the administrative costs associated with these loans are low.