Exam 5: Public Spending and Public Choice

-According to the above figure, if steel mills are charged an effluent fee in order to bear the cost of pollution, what happens to the equilibrium price and equilibrium quantity?

A subsidy is sometimes used by the government to correct the problems associated with

According to your text, which of the following represents the largest source of tax receipts for the Federal government?

In the U.S. economy, which of the following is NOT a generally accepted economic function of government?

The Employment Act of 1946 reflects which one of the following functions of government?

Public goods are basically

If the production of a product results in significant external costs, an appropriate government policy might be to

Money payments made by governments to individuals for which no services or goods are concurrently rendered are known as

Whether an externality is positive or negative, it is always

A shift from S1 to S2 reflects the change that happens when a negative externality is taken into account. A shift from D1 to D2 reflects the change that happens when a positive externality is taken into account. -Refer to the above figures. Which of the panels would be consistent with the situation in which external costs exist?

A free rider is someone who

A shift from S1 to S2 reflects the change that happens when a negative externality is taken into account. A shift from D1 to D2 reflects the change that happens when a positive externality is taken into account. -Refer to the above figures. If a positive externality that existed becomes corrected, price and quantity will become

The legal system provided by the government is necessary for the smooth working of markets because

The economic functions of government include

Which of the following is an example of a public good?

Which of the following is NOT a transfer payment?

-According to the above figure, , then the supply curve will

Market failure occurs when

Markets tend to overallocate resources to the production of a good when