Exam 5: Public Spending and Public Choice

In the above figure, if a Medicare subsidy that had previously been paid by the government has now been eliminated, the result will be

Subsidies paid to the health care industry for Medicare patients are paid by

All of the following generate positive externalities EXCEPT

The free-rider problem plagues public goods because

All of the following are ways that the government can correct for positive externalities EXCEPT

The current Medicare system is designed so that it actually encourages

When there are too few or too many resources going to an economic activity,

An effluent fee is an example of

When does the free-rider problem arise?

Which of the following characterizes the largest difference between the way decisions are made in the private sector versus the public sector?

A transfer payment is a payment

When does a subsidy that benefits consumers result in a more efficient allocation of a resource?

An important assumption in the theory of public choice is that

The free-rider problem is encountered when

By subsidizing the provision of public education, the government

In the United States, which of the following is an example of a government-sponsored good?

-Refer to the above figure. An external benefit exists. The amount of that benefit is represented by

Which of the following is NOT an example of a transfer payment?

According to your text, one reason for flat or falling achievement scores even in the face of substantially higher education subsidies may be that

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