Exam 5: Public Spending and Public Choice

Which of the following might be a method that the government could use to promote the production of a good that generates positive externalities?

Explain why economists consider it to be one of the economic functions of government to provide a legal system.

Which of the following is an example of a negative externality?

Medicare

Which of the following functions of government gives property owners the incentive to use their property efficiently?

Public education is priced below market price largely as a result of

Briefly explain the similarities and differences of decision making by the market sector and the public sector.

A difference between the market and the public sector is that

The economic functions of the government deal with

Fred receives a $14,000.00 per year grant by the federal government because he is disabled. This is a

A firm that produces chemical solvents creates some air pollution because of the emissions from its manufacturing facilities. A tax is imposed on the firm, equal to the costs of environmental damage caused by a unit of the emissions. What is the result?

Public goods are basically

Is there any common characteristic shared by government-inhibited goods and government-sponsored goods? Explain briefly.

If external benefits are taken into account in the market,

The amount of government spending on education per public school student has ________ since 1960, and the achievement level of students has generally ________ since that time.

Which of the following would be considered an economic function of government?

Which of the following is TRUE about the political and market systems of voting?

-Refer to the above figure. The market equilibrium quantity is . Point represents the optimal amount of production. The government can achieve the optimal outcome by

The purpose of an effluent fee imposed on a firm is

-Refer to the above figure. In the absence of a subsidy,