“The size of government is too big.” Evaluate this statement
Please provide the best answer for the statement.
Economists do not worry about the size of government as much as the efficiency of a given program. Focusing on the marginal benefits and marginal costs of programs can determine whether it should be implemented. The program should be implemented or expanded up to the point which the marginal benefit equals the marginal costs, any point beyond that the program should be reduced.
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Keynes's liquidity preference theory of the interest rate suggests that the interest rate is determined by
A. the supply and demand for labor. B. aggregate supply and aggregate demand. C. the supply and demand for loanable funds. D. the supply and demand for money.
Scarcity is a situation in which resources are limited in quantity and can be used in different ways.
Indicate whether the statement is true or false.
The median-voter model implies that:
A. political voting will be as economically efficient as "dollar voting" in competitive markets. B. all voters have about the same preferences for various public goods and services. C. many people will be dissatisfied with the size of government in the economy. D. with majority voting there can never be a consistent ordering of public good preferences.
Elastic demand implies
A) that a one percent increase in price results in a smaller than one percent decrease in quantity demanded. B) that a one percent increase in price results in a larger than one percent decrease in quantity demanded. C) that a one percent cut in price results in a larger than one percent increase in quantity demanded. D) that a one percent decrease or increase in price induces no change in total revenue.