Question 25

The median voter model could explain excessive public expenditure in an economy where

a.marginal benefits were constant across income groups, taxes were uniform, and the income distribution was skewed with many rich and few poor.

b.marginal benefits were constant across income groups, taxes were uniform, and the income distribution was skewed with many poor and few rich.

c.marginal benefits were constant across income groups, taxes were proportional to income, and the income distribution was skewed with many poor and few rich.

d.marginal benefits were proportional to income, taxes were uniform, and the income distribution was skewed with many poor and few rich.

Question 26

Margaret Thatcher implemented economic policy in the UK to restore economic growth, using theories based on the ideas of

a.John Maynard Keynes

b.Daniel Yergin

c.Frederich Hayek

d.John Kenneth Goldbraith

Question 27

Of the four goods listed below, which bears the least resemblance to a pure public good

a.A radio boradcast

b.An outdoor concert

c.An open recital

d.a record album

Question 28

Supply and demand are most often ultimately determined by

a.surplus income.

b.government policy.

c.marginal costs.

d.market forces.

Question 29

The first fundamental theorem of welfare economics states:

a.No one can be made better off without someone is being made worse off.

b.Competitive markets lead to a Pareto efficient allocation.

c.Pareto improvements lead to increased competition.

d.Competitive markets lead to externalities and information problems.

Question 30

Which is not necessarily true of a public good?

a.It costs nothing to let an additional person consume it.

b.It can be a negative thing, that is, a "public bad."

c.It costs a lot to keep an additional person from consuming it.

d.It can be found in both the private and public sectors.