Question 1

An In the News article titled "Perceptions of Government Failure" implies that people lack confidence in the government.If this is true,it may be due to persistent examples of

Accepted Answer

A)  Market failure.
B)  Government failure.
C)  Efficiency.
D)  Merit goods.E) A) and B)
F) A) and C)

Question 2

The largest single source of revenue for the federal government is

Accepted Answer

A)  Excise taxes.
B)  Corporate income taxes.
C)  Social Security payroll taxes.
D)  Personal income taxes.E) All of the above
F) B) and D)

Question 3

State governments receive half of their tax revenue from property taxes.

Accepted Answer

A) True 
 B)False

Question 4

An externality affecting demand can be measured graphically as the

Accepted Answer

A)  Horizontal distance between the market demand curve and the social demand curve.
B)  Vertical distance between the market demand curve and the social demand curve.
C)  Height of the social demand curve at all points.
D)  Height of the market demand curve at all points.E) All of the above
F) C) and D)

Question 5

Government waste implies that the public sector is not producing as many services as it could with the resources at its disposal.

Accepted Answer

A) True 
 B)False

Question 6

A World View article titled "Secondhand Smoke Kills 600,000 People a Year: Study" claims what percentage of all deaths worldwide are caused by secondhand smoke?

Accepted Answer

A)  1 percent.
B)  2 percent.
C)  5 percent.
D)  None of the choices are correct.E) C) and D)
F) All of the above

Question 7

The market will overproduce goods that have external costs because

Accepted Answer

A)  Producers experience lower costs than society.
B)  Producers experience higher costs than society.
C)  The government is not able to produce these goods.
D)  Producers cannot keep these goods from consumers who do not pay,so they have to produce greater amounts.E) A) and C)
F) A) and D)

Question 8

Which of the following is the best example of a government effort to address market failure in relation to the FOR WHOM to produce question?

Accepted Answer

A)  Antitrust policy.
B)  Regulations reducing pollution.
C)  Transfer payments.
D)  The production of goods that allow free riders.E) B) and C)
F) B) and D)

Question 9

Market failure implies that the market mechanism

Accepted Answer

A)  Leads the economy to a point outside the production possibilities curve.
B)  Leads the economy to the wrong mix of output.
C)  Causes shortages or surpluses in the market.
D)  Causes government failure.E) All of the above
F) A) and B)

Question 10

What is public choice theory,and how can it affect government intervention?

Accepted Answer

Public choice theory assumes that public...

Question 11

Any imperfection in the market mechanism that prevents optimal outcomes is known as

Accepted Answer

A)  Market failure.
B)  Government failure.
C)  External cost.
D)  Public cost.E) B) and D)
F) A) and D)

Question 12

The theory of public choice examines

Accepted Answer

A)  How to apply cost-benefit analysis.
B)  The optimal government intervention to correct market failures.
C)  How a policy of laissez faire works to allocate resources.
D)  The role of self-interest in public decisions.E) A) and D)
F) None of the above

Question 13

When the economy experiences abnormally high unemployment,

Accepted Answer

A)  There is government failure.
B)  There is macro instability.
C)  The economy is producing on the production possibilities curve.
D)  No market failure occurs.E) C) and D)
F) None of the above

Exam 4: The Role of Government

What is public choice theory,and how can it affect government intervention?

Correct Answer
verified
Public choice theory assumes that public...
View Answer

The market will overproduce goods that have external costs because

Correct Answer
verified

State governments receive half of their tax revenue from property taxes.

Correct Answer
verified

Market failure implies that the market mechanism

Correct Answer
verified

Any imperfection in the market mechanism that prevents optimal outcomes is known as

Correct Answer
verified

An In the News article titled "Perceptions of Government Failure" implies that people lack confidence in the government.If this is true,it may be due to persistent examples of

Correct Answer
verified

Which of the following is the best example of a government effort to address market failure in relation to the FOR WHOM to produce question?

Correct Answer
verified

The largest single source of revenue for the federal government is

Correct Answer
verified

The theory of public choice examines

Correct Answer
verified

When the economy experiences abnormally high unemployment,

Correct Answer
verified

Government waste implies that the public sector is not producing as many services as it could with the resources at its disposal.

Correct Answer
verified

An externality affecting demand can be measured graphically as the

Correct Answer
verified

A World View article titled "Secondhand Smoke Kills 600,000 People a Year: Study" claims what percentage of all deaths worldwide are caused by secondhand smoke?

Correct Answer
verified

Exam 4: The Role of Government

What is public choice theory,and how can it affect government intervention?

Correct AnswerverifiedPublic choice theory assumes that public...View AnswerShow Answer

The market will overproduce goods that have external costs because

Correct AnswerverifiedShow Answer

State governments receive half of their tax revenue from property taxes.

Correct AnswerverifiedShow Answer

Market failure implies that the market mechanism

Correct AnswerverifiedShow Answer

Any imperfection in the market mechanism that prevents optimal outcomes is known as

Correct AnswerverifiedShow Answer

An In the News article titled "Perceptions of Government Failure" implies that people lack confidence in the government.If this is true,it may be due to persistent examples of

Correct AnswerverifiedShow Answer

Which of the following is the best example of a government effort to address market failure in relation to the FOR WHOM to produce question?

Correct AnswerverifiedShow Answer

The largest single source of revenue for the federal government is

Correct AnswerverifiedShow Answer

The theory of public choice examines

Correct AnswerverifiedShow Answer

When the economy experiences abnormally high unemployment,

Correct AnswerverifiedShow Answer

Government waste implies that the public sector is not producing as many services as it could with the resources at its disposal.

Correct AnswerverifiedShow Answer

An externality affecting demand can be measured graphically as the

Correct AnswerverifiedShow Answer

A World View article titled "Secondhand Smoke Kills 600,000 People a Year: Study" claims what percentage of all deaths worldwide are caused by secondhand smoke?

Correct AnswerverifiedShow Answer

Correct Answer
verified
Public choice theory assumes that public...
View Answer

Correct Answer
verified

Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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