Which of the following are potential problems with direction and managing government?
The government's massive size and scope
Politicians aren't as intelligent as the rest of society
It is difficult for the government to effectively aggregate information from bottom to top
Answer A and C are correct
What is the correct criterion in evaluating government programs?
The size of government: A larger government provides more goods.
The size of government: A smaller government has lower taxes.
By comparing the marginal benefit to the marginal cost of the government program. If the marginal benefit exceeds the marginal cost this is an efficient program.
By comparing the marginal benefit to the marginal cost of the government program. If the marginal cost exceeds the marginal benefit this is and efficient program.
An unfunded liability for a government program implies that:
projected government expenditure exceeds projected government revenue for the program
the government program is self-sustaining
projected government revenue exceeds projected government expenditure for the program
the government has yet to establish the program
A special-interest issue is one whose passage yields:
large private benefits compared to external benefits
large external benefits compared to private benefits
small economic losses to a small number of people and large economic losses to a large number of people
large economic gains to a small number of people and small economic losses to a large number of people
politicization of fiscal and monetary policy refers to:
The use of fiscal and monetary policy to help foreign government
Is the primary reasons for public sector efficiency
The use of fiscal and monetary policy to help politicians before an election
Creates the opportunity for the fallacy of limited decisions
Which of the following is the most likely cause of unfunded liabilities?
The cost of the program is immediate while the benefit is in the distant future.
The benefit of the program is immediate while the cost is in the distant future.
Politicians are helping as many people as they can.
Voters prefer taxes now rather than in the future.
It is often argued that government laws and regulations have unintended consequences. Which of the following is an unintended consequence of the 2010 healthcare reform law?
Everyone will now have health insurance.
Companies are now willing to employ more full-time workers.
Companies are reducing full-time employees to part-time employees.
Insurance markets are now more efficient.
The concept of limited choices, as used in public choice theory, refers to the fact that:
Politicians may not be objective in evaluating economic policy programs
Because of the importance of television and other modern communication techniques, the best and brightest candidates may not be selected by voters
Voters must select a candidate who represents a "bundle" of various public policy programs and who can't register support or opposition for specific programs
The most economically efficient public policy program may not be selected because political leaders do not know enough about economics
