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Public Finance and Public Choice MCQ

Entrepreneurship (profits) account for about ______ percent of national income.

Answer

Correct Answer: 23

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Public goods are a form of _____.

Market Failure

Free Market

Steeper

Perfectly vertical

Answer

Correct Answer: Market Failure

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The private benefit is , while the social benefit is .

The benefit recieved by the consumer of a good or service; the total benefits from consuming the good

The marginal benefit from reducing another ton of pollution should be equal to the marginal cost;the benefit recieved by the consumer of a good or service

The social benefit from consuming the good to be greater than the private benefit;A situation in which the market fails to produce the efficient level of output

None of these

Answer

Correct Answer: The benefit recieved by the consumer of a good or service; the total benefits from consuming the good

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When politicians trade votes for their legislation, it is known as ______.

Rational ignorance

Log rolling

Public choice

Median consumption

Answer

Correct Answer: Log rolling

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When individuals and firms use resources, like money and lobbyists, to influence government to grant them special privileges, it is known as ______.

Rent seeking

Log rolling

Public choice

Individual consumption

Answer

Correct Answer: Rent seeking

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Special interest groups ______.

Are theorists who study elections under the assumption that all political activity is motivated primarily by self-interest

Are unmotivated to spend the time and energy necessary to learn about the candidates and issues in an election

Try to judge public sentiment and align their views to what is publicly popular during a given election cycle

Have an intense interest in particular voting issues that may be different from the interests of the general public

Answer

Correct Answer: Have an intense interest in particular voting issues that may be different from the interests of the general public

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The lack of incentive to be informed is known as ______.

Log rolling

Public choice

Rational ignorance

Irrational exuberance

Answer

Correct Answer: Rational ignorance

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The application of economics to politics is known as ______.

Public choice theory

Progressive taxation theory

Median voter model

Rational ignorance approach

Answer

Correct Answer: Public choice theory

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Public choice economists believe that government actions are an outgrowth of ______.

Theoretical models

Individual behavior

Fiscal policy

Historical forces

Answer

Correct Answer: Individual behavior

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A flat tax is also called a ______.

Transfer

Grant

Sales tax

Proportional tax

Answer

Correct Answer: Proportional tax

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Historically, most state and local tax revenue has come from ______ taxes.

Property

Sales

Excise

Income

Answer

Correct Answer: Property

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The fraction of additional income paid in taxes is called the ______ tax rate.

Average

Marginal

Excise

Income

Answer

Correct Answer: Marginal

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What do we call a sales tax on individual products such as alcohol, tobacco, and gasoline?

Progressive tax

Payroll tax

Excise tax

Flat tax

Answer

Correct Answer: Excise tax

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The current federal income tax is a ______ tax.

Regressive

Progressive

Flat

Consumption

Answer

Correct Answer: Progressive

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Payroll taxes are levied on ______-related income.

Work

Investment

Rent

Gambling

Answer

Correct Answer: Work

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Most federal taxes are aimed at ______.

Consumption

Sales

Property

Income

Answer

Correct Answer: Income

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What event in 2008–2009 had a lasting influence on government expenditures?

Global expansion

Global recession

Global depression

Global boycott

Answer

Correct Answer: Global recession

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What did government expenditures do between 1950 and 1975?

Rapidly shrink

Remain constant

Grow slowly

Rapidly expand

Answer

Correct Answer: Grow slowly

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The concept that people with different levels of income should be treated differently is called

Horizontal Equity

Vertical Equity

Economic Equity

Marginal Equity

Answer

Correct Answer: Vertical Equity

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Groups with an intense interest in particular voting issues are called

Special interest groups

Public interest groups

General interest groups

Common interest groups

Answer

Correct Answer: Special interest groups

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In _____ smaller percentage of taxable income is taken as taxable income increases

Progressive tax

Regressive tax

Flat Tax

Excise Tax

Answer

Correct Answer: Regressive tax

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Rational ignorance is sufficient incentive to be informed

True

False

Answer

Correct Answer: False

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_____ is designed so that a larger percentage of taxable income is taken as taxable income increases.

Progressive tax

Regressive tax

Flat Tax

Excise Tax

Answer

Correct Answer: Progressive tax

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Median voter model is A model that predicts candidates will choose a position in the ______ of the distribution

Start

Middle

End

None of these

Answer

Correct Answer: Middle

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Exchanging votes to get support for legislation is called.

Enrolling

Logrolling

Segmental rolling

None of these

Answer

Correct Answer: Logrolling

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____ is a tax that charges all income earners the same percentage of their income.

Progressive tax

Regressive tax

Flat Tax

Excise Tax

Answer

Correct Answer: Flat Tax

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A sales tax on individual products such as alcohol, tobacco is called

Progressive tax

Regressive tax

Flat Tax

Excise Tax

Answer

Correct Answer: Excise Tax

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According to Ability-to-pay principle those with greatest ability to pay taxes should pay ____ than those with less ability to pay

More Tax

Less Tax

Income Tax

Excise Tax

Answer

Correct Answer: More Tax

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Public Finance and Public Choice MCQ

Entrepreneurship (profits) account for about ______ percent of national income.

Public goods are a form of _____.

The private benefit is ________, while the social benefit is ________.

When politicians trade votes for their legislation, it is known as ______.

When individuals and firms use resources, like money and lobbyists, to influence government to grant them special privileges, it is known as ______.

Special interest groups ______.

The lack of incentive to be informed is known as ______.

The application of economics to politics is known as ______.

Public choice economists believe that government actions are an outgrowth of ______.

A flat tax is also called a ______.

Historically, most state and local tax revenue has come from ______ taxes.

The fraction of additional income paid in taxes is called the ______ tax rate.

What do we call a sales tax on individual products such as alcohol, tobacco, and gasoline?

The current federal income tax is a ______ tax.

Payroll taxes are levied on ______-related income.

Most federal taxes are aimed at ______.

What event in 2008–2009 had a lasting influence on government expenditures?

What did government expenditures do between 1950 and 1975?

The concept that people with different levels of income should be treated differently is called

Groups with an intense interest in particular voting issues are called

In _____ smaller percentage of taxable income is taken as taxable income increases

Rational ignorance is sufficient incentive to be informed

_____ is designed so that a larger percentage of taxable income is taken as taxable income increases.

Median voter model is A model that predicts candidates will choose a position in the ______ of the distribution

Exchanging votes to get support for legislation is called.

____ is a tax that charges all income earners the same percentage of their income.

A sales tax on individual products such as alcohol, tobacco is called

According to Ability-to-pay principle those with greatest ability to pay taxes should pay ____ than those with less ability to pay

The private benefit is , while the social benefit is .