-In the Above Figure, Equilibrium Expenditure Is

question 349

Multiple Choice

-In the above figure, equilibrium expenditure is

• A) $12 trillion.
• B) less than $12 trillion.
• C) more than $12 trillion.
• D) some amount that cannot be determined without more information.

---

Definitions:

Government Provision

The supply of goods or services by the government directly or through funding public institutions.

Rational-Ignorance Effect

The decision by individuals to remain uninformed about certain matters because the perceived cost of acquiring the information exceeds the expected benefit.

Shortsightedness Effect

The misallocation of resources that results because public-sector action is biased (1) in favor of proposals yielding clearly defined current benefits in exchange for difficult-to-identify future costs and (2) against proposals with clearly identifiable current costs that yield less concrete and less obvious future benefits.

Private-Sector Provision

The production and supply of goods and services by businesses or entities that are not part of the government or public sector.