Exam 5: Public Spending and Public Choice

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

Public goods are basically

Medicare

Receiving a voucher for an apartment in a public housing project would be an example of a good that satisfies

Which of the following might be considered a positive externality?

The distinguishing characteristic of private goods is that

Graphically, the effects of an external benefit can be shown as

The non-exclusion principle means

The free-rider problem is

In the absence of government

-Refer to the above figure. The market equilibrium quantity is Q1. Point Q2 represents the optimal amount of production. This indicates that there is

In its most ideal form, a price system allows

The purpose of antitrust legislation is

A payment that is made by the government for which no goods or services are given in return is known as

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. A negative externality exists that has not been corrected. Price and quantity will be

Government outlays include all of the following EXCEPT

An effluent fee

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

In graphical form,the effect of imposing a tax on a good is shown as

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. An external cost exists. This will lead to a(n)