Question 1

Public choice analysis suggests that the primary motivating factor for politicians will be finding the policies that are most likely to

Accepted Answer

Public choice analysis posits that politicians are primarily motivated by self-interest, particularly the desire to be reelected, rather than by the goal of improving economic efficiency or societal welfare.

Question 2

Which of the following is true?

Accepted Answer

Politicians often focus on policies that will help them gain votes and financial support for reelection, rather than solely pursuing what is best for society or focusing on long-term impacts.

Question 3

Economic analysis suggests that bureaucrats and public-sector managers have a strong incentive to

Accepted Answer

Bureaucrats and public-sector managers often have an incentive to expand their budgets to increase their power, influence, and job security, even if it leads to inefficiencies.

Question 4

Public choice theory indicates that the behavior of people in government

Accepted Answer

Public choice theory suggests that individuals in government are motivated by the same self-interest as those in the private sector, and their behavior can be understood using similar principles.

Question 5

As methods of economic organization, the market and the public sector are similar in which of the following ways?

Accepted Answer

In both the market and the public sector, the provision of scarce goods involves costs that must be covered, whether through prices in the market or taxes in the public sector.

Question 6

Senator Dogood is pushing for the construction of a new military base in his state even though, from the standpoint of national security, it is clear that there are better places to locate the new military base. Economic theory would suggest that Senator Dogood is

Accepted Answer

Senator Dogood is likely acting in his own political interest, as having the base in his state could bring economic benefits and increase his popularity among constituents, thereby improving his chances of reelection.

Question 7

In 2015, the combined expenditures of federal, state, and local governments in the United States were approximately 36 percent of gross domestic product (GDP). Approximately what percentage of GDP were government expenditures in 1930?

Accepted Answer

In 1930, government expenditures in the United States were approximately 9 percent of GDP, reflecting a much smaller government role in the economy compared to 2015.

Question 8

Economic theory indicates that the behavior of

Accepted Answer

Economic theory suggests that all individuals, including voters, government employees, and public officials, respond to incentives, similar to individuals in the private sector.

Question 9

Market allocation and the political process differ in that

Accepted Answer

In the market sector, consumers directly pay for the goods and services they receive, creating a direct link between payment and receipt. In the political sector, taxes fund public goods and services, and individuals may not directly receive benefits proportional to their contributions.

Question 10

John Smith is a typical citizen. Economic theory suggests that he is likely to make a more informed choice when he buys a personal computer than when he votes for a congressional candidate. This view is

Accepted Answer

Individuals have more incentive to be informed about personal purchases, like a computer, where their decision directly impacts them, compared to voting, where a single vote is unlikely to change the election outcome.

Question 11

Combined federal, state, and local government expenditures in the United States were approximately 9 percent of the gross domestic product (GDP) in 1930. How large were government expenditures as a share of GDP in 2015?

Accepted Answer

Government expenditures as a share of GDP have increased significantly since 1930, reaching approximately 36 percent in 2015.

Question 12

A politician may be considered an entrepreneur in the sense that

Accepted Answer

A politician can be considered an entrepreneur because they identify and provide political solutions or policies that align with voter demands, similar to how entrepreneurs identify and meet consumer needs in the market.

Question 13

At the most basic level, the distinguishing characteristic of government that makes it different from private firms is

Accepted Answer

Governments have the unique authority to use coercive force, such as taxation and regulation, to enforce laws and policies, which distinguishes them from private firms.

Question 14

Senator Blacklung represents a state that grows a significant amount of tobacco. Not only do many of his constituents work for businesses in this industry, but the tobacco firms also make generous contributions to his reelection campaign. According to public choice theory, which of the following bills would Senator Blacklung be most likely to support?

Accepted Answer

Senator Blacklung would likely support a bill that benefits the tobacco industry, such as providing subsidies for tobacco growers, due to the economic interests of his constituents and the campaign contributions he receives from tobacco firms.

Question 15

Which of the following is true regarding government expenditures in the United States?

Accepted Answer

Government expenditures as a share of GDP grew rapidly between 1930 and 1980 due to factors such as the New Deal, World War II, and the expansion of social programs.

Question 16

Which one of the following is a major difference between market and collective action through government?

Accepted Answer

In the market sector, individuals typically pay directly for the goods and services they consume, creating a direct link between payment and consumption. In contrast, government-provided goods and services are often funded through taxation, which does not directly link payment to individual consumption.

Question 17

At the most basic level, the distinguishing characteristic of government that makes it different from private firms is its ability to

Accepted Answer

Governments have the unique authority to use coercive force, such as taxation and regulation, to enforce laws and policies, which private firms cannot do.

Question 18

Public choice theory indicates competitive forces provide a politician with a strong incentive to offer voters a bundle of political goods that she believes

Accepted Answer

Public choice theory suggests that politicians are motivated by self-interest, similar to individuals in markets, and thus aim to offer policies that will maximize their chances of being elected or re-elected.

Question 19

Which of the following is true?

Accepted Answer

Scarcity imposes a link between aggregate consumption and aggregate payment in both the market and public sectors, as resources are limited and choices must be made about their allocation.

Question 20

The fact that voters perceive their votes as unlikely to actually change the outcome of an election causes

Accepted Answer

When voters believe their individual vote is unlikely to change the outcome, they have little incentive to invest time and effort in becoming informed about candidates and political issues, leading to voter apathy.

Quiz 6: The Economics of Political Action

Public choice analysis suggests that the primary motivating factor for politicians will be finding the policies that are most likely to

Which of the following is true?

Economic analysis suggests that bureaucrats and public-sector managers have a strong incentive to

Public choice theory indicates that the behavior of people in government

As methods of economic organization, the market and the public sector are similar in which of the following ways?

Senator Dogood is pushing for the construction of a new military base in his state even though, from the standpoint of national security, it is clear that there are better places to locate the new military base. Economic theory would suggest that Senator Dogood is

In 2015, the combined expenditures of federal, state, and local governments in the United States were approximately 36 percent of gross domestic product (GDP) . Approximately what percentage of GDP were government expenditures in 1930?

Economic theory indicates that the behavior of

Market allocation and the political process differ in that

John Smith is a typical citizen. Economic theory suggests that he is likely to make a more informed choice when he buys a personal computer than when he votes for a congressional candidate. This view is

Combined federal, state, and local government expenditures in the United States were approximately 9 percent of the gross domestic product (GDP) in 1930. How large were government expenditures as a share of GDP in 2015?

A politician may be considered an entrepreneur in the sense that

At the most basic level, the distinguishing characteristic of government that makes it different from private firms is

Which of the following is true regarding government expenditures in the United States?

Which one of the following is a major difference between market and collective action through government?

At the most basic level, the distinguishing characteristic of government that makes it different from private firms is its ability to

Public choice theory indicates competitive forces provide a politician with a strong incentive to offer voters a bundle of political goods that she believes

Which of the following is true?

The fact that voters perceive their votes as unlikely to actually change the outcome of an election causes