To Choose the Optimal Level of Government Expenditures, G*, the Government

question 6

Multiple Choice

To choose the optimal level of government expenditures, G*, the government

• A) must know the preferences of all consumers over private and public goods.
• B) needs only to balance the budget, as any level of G is Pareto-optimal.
• C) must minimize the tax burden.
• D) must know the preferences of all consumers and minimize the tax burden.
• E) must obtain the correct balance between military spending and social programs.