Exam 13: Capital Assets: Planning and Budgeting, Analysis, and Management

In an economic benefit analysis, what do we call the potential indirect spillover or secondary costs and benefits?

What are the main reasons state and local governments formally segregate capital and current expenditures into two distinct budgets?

How are capital investments handled in the U.S. federal budget?

Which of the following is a typical problem that sometimes occurs in classifying an expenditure as capital or current?

Discuss the concerns many have over the consequences of deterioration in the condition of the U.S.'s physical infrastructure base, including highways, bridges, and water and sewer systems. Include in the discussion the relative roles of the federal government versus state and local governments in financing infrastructure over the last 30 or more years and the federal role in direct and indirect infrastructure financing.

Approximately what percentage of the capital investment portion of the U.S. federal budget goes toward Department of Defense acquisitions?

Many governmental entities ignore the distinction between capital and current expenditures.

Which of the following is not an example of a capital project?

Governments, and other organizations, that have a comprehensive multiyear capital investment plan typically also have a corresponding capital budget.

Various studies have estimated that the combined infrastructure deficit in public facilities in the United States, like water systems, schools, and highways, is several trillion dollars.

In the public sector, the purchase or construction of a long-lasting physical asset or facility is called a(n):

Which level of government in the United States does not employ a formal capital budgeting process?

Capital budget decisions are less political than other budget decisions.

The financial resources necessary to implement a capital investment program at the local level rarely are financed through:

Approximately what percentage of federal physical capital outlays are grants to state and local governments?

The main difference between cost-benefit and cost-effectiveness analysis is in differences in how costs are measured.

When ranking capital project priorities at the state and local level, what is most often the first concern?

Discuss the importance at the state and local levels of government of an annual examination of capital investments such as infrastructure in the context of a thorough capital investment planning process. Include in the discussion the differences between how state and local capital investments are financed and how that impacts on voters' reactions to the capital budget.

What is the term for imputing the benefit of a proposed government project or service when no market price exists?

For most state and local governments, the application of complex analytical tools such as cost-benefit analyses or rate-of-return analyses play a significant role in the selection of capital projects.