Exam 5: Public Spending and Public Choice

When negative externalities exist, the private market equilibrium represents a

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

A firm that has a great deal of control over the price of a good is said

Private schools are able to exclude students from attending classes they offer unless students have been accepted and paid tuition and fees. This suggests that education is

Medicare is an example of a third-party payment for medical services that

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

Medicare subsides will cause people to

The government tries to protect the competitive economic system by passing and enforcing

A government-sponsored good is one that

Government goods are provided to the consumer at a zero price. This means that

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

-Refer to the above figure. In the absence of a subsidy,

The concept that a student is enjoying the benefits of police protection even though she does pays taxes is called

An effluent fee is an example of

Scarcity of resources

Which of the following is an example of a negative externality?

Examples of transfers-in-kind include

Which of the following is NOT a consequence of the introduction of the Medicare program?

All of the following are characteristics of public goods EXCEPT

A market failure likely occurs when