The likelihood of successful private solutions to problems caused by externalities depends, in part, upon the number of interested parties. Briefly explain
When there is a large number of interested parties, coordinating them all to bargain is costly, if not impossible.
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When a nation prints money (rather than taxing directly) to finance its government spending, it results in inflation, and purchasing power of the private sector falls. This is known as:
A) benchmarking. B) indirect taxation. C) seigniorage. D) creeping inflation.
In a sporting goods store, you can buy the equipment you want and forgo the rest. But in an election you "buy" the entire range of the candidate's positions, including some you may not agree with. This difference:
A. reflects limited and bundled choices in the public sector. B. describes the paradox of voting. C. describes the principal-agent problem in the public sector. D. creates bureaucratic inefficiency in the public sector.