ecocho15

Purchases or the production of goods or services by government agencies are called:

government purchases.

Public goods may be efficiently provided if they are financed through:

government tax revenues.

The models of market failure suggest that government intervention may ________ resource allocation but that the result _______ .

improve; may not be achieved

The best example of a good for which exclusion is prohibitively costly is:

national defense.

The best example of a good that has zero marginal cost to add another consumer is:

national defense.

The two largest sources of U.S. government revenue are:

payroll taxes and individual income taxes.

A tax that takes a higher percentage of income as income rises is a(n):

progressive tax.

The free-rider problem is most important for:

public goods.

Paying a tax of $20 on an income of $100, a tax of $15 on an income of $200, and a tax of $12 on an income of $300 is an example of a:

regressive tax.

In the case of an external cost:

the agent responsible for the external cost will produce too much of the good or service involved.

A public good is one for which:

the marginal cost of adding another consumer is zero.

The difference between government purchases and government expenditures is largely due to:

transfer payments.

The best example of a good for which exclusion is not prohibitively costly is:

a bicycle.

An example of a transfer payment is:

a Social Security payment to the disabled.

The market failure of imperfect competition is most likely to result if Peanuts 'R' Us:

acquires ownership of all peanut butter processing plants in the country.

All spending by government agencies is called:

government expenditures.