Figure 7-3 ​ Government Provides Many Goods and Services to the Public Because

Multiple Choice

Figure 7-3 ​

Government provides many goods and services to the public because they are not provided by free markets. Some economists believe bureaucrats who manage the programs have no interest in maximizing net benefits (profits) but instead maximize the size of a program constrained only by the need to have total benefits exceed total costs. Figure 7-3 shows total benefits and cost curves for a program. What point is the efficient point, and what point will the bureaucrat choose?

A) A and B, respectively
B) B and D, respectively
C) D and C, respectively
D) D and A, respectively