Author Question: Market activity differs from government activity because a. markets generally force prices to ... (Read 111 times)

bobypop · **on:** Jul 1, 2018

Market activity differs from government activity because
a. markets generally force prices to below-cost levels
b. governments never charge for the services they provide
c. markets do not use voluntary exchange mechanisms
d. markets provide a direct link between benefits and costs
e. governments have strong incentives to keep costs under strict control

Question 2

Government policies are coercive, whereas markets are not. This implies that
a. government activity will always be less efficient than market activity
b. households cannot maximize utility if they consume any government goods and services
c. market transactions result in an equal number of gainers and losers
d. self-interest and public interest are always in conflict
e. government can provide some goods and services when private markets fail to do so