If a citizen doesn’t pay for national defense, the citizen ______ get it. Hence, national
defense is a ___ good.
A. doesn’t; public
B. doesn’t; private
C. does; public
D.does; private
Answer:
An individual requirement is aimed at preventing ______.
A. free-riding
B. non-medical spending
C. excessive freedom
D. neglect of health
Answer:
An _____ is paid monthly for as long as the retiree lives.
A. amortization
B. insurance benefit
C. annuity
D. entitlement
Answer:
Figure 2.1 shows the supply and demand diagram for steel. Environmental damage per
unit produced is $60.
Refer to Figure 2.1. The MD to the environment from the 200th unit is ____.
A. $20
B. $40
C. $60
D. $300
Answer:
Will polluters pass on pollution prices to consumers by raising product prices? Is this
good or bad?
A. no; good
B. no; bad
C. yes; good
D. yes; bad
Answer:
If a consumer doesn’t pay for a TV, the consumer _____ get it. Hence, the TV is a a
____good
A. doesn’t; public
B. doesn’t; private
C. does; public
D.does; private
Answer:
A worker’s social security wealth is
A. the estimated present value of her future social security benefits.
B. the stocks and bonds she bought out of her wage income.
C. the stocks and bonds she would buy if social security established investment
accounts.
D. the bonds that social security has bought on her behalf.
Answer:
A labor income tax would _____.
A. exempt capital income from tax
B. not have graduated rates
C. tax consumption
D. discourage saving
Answer:
The 2007 Minneapolis highway bridge collapse was tragic
A. and shows that the quantity of inspections was less than optimal.
B. but does not show whether the quantity of inspections was optimal.
C. and shows that inspections should definitely be increased.
D. and shows that inspections should probably be increased.
Answer:
Under catastrophic insurance, the household has ____ to consider the ____ of ordinary
medical care.
A. no incentive; benefit
B. an incentive; benefit
C. no incentive; cost
D. an incentive; cost
Answer:
Which term has a different meaning from the others?
A. efficiency loss
B. deadweight loss
C. excess burden
D. reflex burden
Answer:
Refer to Figure 3.1. The socially optimal wall thickness is ____ feet.
A. 4
B. 5
C. 6
D.10
Answer:
____ bear most of the burden of employer-provided health insurance.
A. Employers
B. Consumers
C. Stockholders
D. Workers
Answer:
Assume there is no externality. The inefficiency from the tax equals the area of a ___ to
the ___ of the intersection of the original D and S curves.
A. triangle; left
B. triangle; right
C. rectangle; left
D. rectangle; right
Answer:
Net debt as a percentage of GDP rose from ___ of GDP in 1980 to ___ in 1993 before
declining.
A. 13%; 24%
B. 26%; 49%
C. 39%; 74%
D. 52%; 99%
Answer:
The cost estimate in 2002 by economist Nordhaus of an intervention in Iraq was ___
billion or ___ per person.
A. $150; $500
B. $300; $1,000
C. $1,900; $6,000
D. $19,000; $60,000
Answer:
Refer to Figure 3.1. At a wall thickness greater than the social optimum, the ____.
A. ΣMC; greater; MB
B. ΣMC; less; MB
C. ΣMB; greater; MC
D. ΣMB; less; MC
Answer:
The two largest categories of state and local spending are _____.
A. education and health
B. education and transportation
C. health and transportation
D. health and public safety
Answer:
Government ____ who administer grvernment departments have an incentive to ___
legislators to ___ their programs.
A. bureaucrats; lobby; expand
B. bureaucrats; lobby; contract
C. agents; bully; reform
D. agents; bully; deform
Answer:
____ try to regulate medical prices and the use of medical services.
A. Governments, but not private insurers,
B. Private insurers, but not governments,
C. Both governments and private insurers
D. Neither governments nor private insurers
Answer:
To know how to vote, each voter must know its ____ and its ____.
A. MB curve; cost-share
B. ΣMB curve; cost-share
C. MB curve; Σ cost-share
D. ΣMB curve; Σ cost-share
Answer:
Many non-economists think ___ should not be considered in deciding whether
government should pay for medical treatment X.
A. safety
B. effectiveness
C. benefit
D. cost
Answer:
Replacing the current U.S. income tax with either a RST or a VAT that raises the same
revenue would cause a redistribution of the tax burden away from _____ households.
Answer:
The household income tax could be converted into a household consumption tax by
letting households deduct ____.
Answer:
Under Social Security, the worker and employer each owe a tax equal to __% of wage
income up to a ceiling of ___ (in 2008).
Answer:
In contrast to economists, many non-economists think ___ should not be considered in
deciding whether government should pay for medical treatment X.
Answer:
____ bear most of the burden of employer-provided health insurance.
Answer:
A mistake sometimes made in cost-benefit analysis is counting job _____ as a _____.
Answer:
The unemployment compensation benefit is about ___ of previous wage income for the
average worker.
Answer:
Present the most important lines on a U.S. individual income tax return. Make up
plausible numbers for these lines (the number for tentative tax need not be correct).
Comment on the lines below taxable income.
Answer:
Another way to reduce the ____ of a RST or a VAT is by sending each household a
_____.
Answer: