The "Public Choice" school of economists argue that:
a. the invisible hand of the market is inefficient in allocating resources to their best uses.
b. the government often does not take correct economic decisions as it is run by self-interested politicians.
c. the government takes correct decisions as it is run by conscious and educated individuals.
d. the market fails to maximize social efficiency.
e. the government is a non-profit making organization which works to maximize social efficiency.
b
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When the federal government is running a budget deficit:
a. government tax revenues exceed government expenditures. b. government expenditures exceed government tax revenues. c. the economy must be in an economic recession. d. the size of the national debt will decline.
Assume that the professors at a local college have gone without a pay increase for 4 years during a tough time. Suppose that things start to look up and the President of the college wants to make up for lost time. If the CPI in 2002 was 150 and 175 in 2006, how much will salaries have to increase to bring the faculty back up to their real income from 2002?
a. 175.0% b. 150.0% c. 25.0% d. 16.7% e. 14.3%