Question : 31) The figure above shows the marginal cost and marginal : 1238676

31) The figure above shows the marginal cost and marginal benefit of police protection in the city of Hugo, Oklahoma. Police protection is a public good. The efficient number of officers that should be hired by the city of Hugo is

A) 15.

B) 25.

C) 10.

D) 0.

E) More than 25 because MB > $0 when 25 officers are hired.

32) Because national defense is potentially subject to free riding, a private sector market for national defense would lead to

A) the efficient amount of national defense if there is free riding.

B) more than the efficient amount being produced if there is free riding.

C) less than the efficient amount being produced if there is free riding.

D) less than the efficient amount being produced if there is not free riding.

E) None of the above answers is correct.

33) The free-rider problem for a public good means that

A) a private market would provide less than the efficient amount of the good.

B) a private market would provide more than the efficient amount of the good.

C) the good is rival.

D) the good is excludable.

E) a private market would provide the efficient amount of the good.

34) For any individual consumer, free-riding is

A) common for private goods.

B) rational.

C) irrational.

D) impossible for public goods.

E) the same as paying a fair price for the good.

35) A private, competitive market

A) provides the efficient quantity of a public good.

B) allocates too few resources for a public good.

C) allocates too many resources for a public good.

D) can be relied upon to allocate resources efficiently both for private and public goods.

E) will allocate too many resources for a public good only if free riding occurs.

36) Why are private firms unable to produce public goods?

A) Because the government outlaws private firms from producing them.

B) The marginal cost of production is too high for private production to be possible.

C) They can produce these goods, but they would not earn any revenue because of the free-rider problem.

D) The tragedy of the commons means that private firms produce an inefficient amount of public goods.

E) None of the above answers is correct.

37) The principle of minimum differentiation describes a tendency of competitors to

A) lower price.

B) offer similar products or policies.

C) decrease the quantity of goods available.

D) offer public goods for sale.

E) free ride.

38) Which of the following describes the principle of minimum differentiation?

A) competitors becoming identical to appeal to the largest number of clients or voters

B) minimizing the difference between marginal benefit and marginal cost

C) voters becoming highly informed to elect the best candidate

D) bureaucrats providing the most efficient level of pubic goods provision

E) minimizing the amount of free riding that occurs

39) The tendency of political parties to propose identical policies which appeal to the maximum number of voters is referred to as the principle of

A) maximum differentiation.

B) minimum differentiation.

C) minimum marginal utility.

D) maximum returns.

E) agreement.

40) In politics, the principle of minimum differentiation is the tendency toward

A) identical policies to appeal to a minimum number of people.

B) different policies to appeal to a maximum number of people.

C) identical policies to appeal to a maximum number of people.

D) different policies to appeal to a minimum number of people.

E) a minimum number of policies in order to appeal to a maximum number of people.