Special Interest Group K Receives a 1\100^th Slice of the Economic

Multiple Choice

Special interest group K receives a 1\100^th slice of the economic pie.  Its net benefit from either an economic growth policy or a transfer policy is $200,000.  In order for group K to be indifferent between the two policies, the economic growth policy would have to make the size of the economic pie (Real GDP) grow by  _________________.  This type of analysis is used to show that special interest groups tend to press government for ______________ instead of ________________.

A) $20,000,000; economic growth; transfers
B) $2,000,000; transfers; economic growth
C) $20,000,000; transfers; economic growth
D) $2,000,000; economic growth; transfers