Which of the following best describes the changes in relative prices that occur as an economy adjusts itself to the provision of public service?
A)Compliance costs
B)Externalities and spillovers
C)Tangible and real benefits
D)Pecuniary benefits and costs
E)Opportunity costs

Question

Quizplus · Accepted Answer

Public services can result in pecuniary benefits and costs, which are changes in prices caused by changes in the quantity supplied or demanded of a good or service. As public services are provided, they can result in changes in the prices of goods and services depending on how they affect the supply and demand for these goods and services. For example, public transportation may reduce the demand for cars and therefore lower the price of cars, while also increasing the demand for public transportation and therefore raising its price.

Which of the Following Best Describes the Changes in Relative