When analyzing public sector decision making, economic theory assumes voters, politicians, and government officials will
a. respond to changes in personal benefits and costs when making public sector choices.
b. always pursue the public interest even when it conflicts with their private interests.
c. generally ignore the personal costs and benefits associated with their choices.
d. make decisions that seek to maximize the amount of benefits created for society as a whole.
A
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Using the information in the table above, net exports equals
A) $1,370 billion. B) $650 billion. C) $20 billion. D) -$70 billion.
A Phillips curve is
A) the correlation between money growth and the inflation rate. B) the negative correlation between the unemployment rate and the vacancy rate. C) the positive observed correlation between the inflation rate and the nominal interest rate. D) an observed positive correlation between the inflation rate and some measure of aggregate economic activity.
Assuming an inflationary gap exists, classical economists believe that flexible wages will restore full employment
a. True b. False Indicate whether the statement is true or false
The reform of the welfare system passed by Congress and signed by President Clinton changed the benefits for welfare recipients as it
a. decreased the number of people eligible for benefits, increased the benefit amount for those still eligible, and set a maximum coverage period of five years b. decreased the number of people eligible for benefits, cut the benefit amount for those still eligible, and set a maximum coverage period of three years c. increased the number of people eligible for benefits, cut the benefit amount for those still eligible, and set a maximum coverage period of three years d. decreased the number of people eligible for benefits, cut the benefit amount for those still eligible, and set a maximum coverage period of five years e. froze the number of people eligible for benefits, cut the benefit amount for those still eligible, and set a maximum coverage period of three years