Anthony Downs, in the Economic Theory of Democracy, Argues That

question 68

Multiple Choice

Anthony Downs, in The Economic Theory of Democracy, argues that voters choose to remain "rationally ignorant" when they vote in elections, knowing relatively little about the candidates or the issues.What economic principle would you invoke to explain this behavior?

• A)public good theory 
• B)moral hazard 
• C)the cost of information 
• D)risk aversion

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Definitions:

U.S. Exports

Goods, services, and capital sent from the United States to other countries, contributing to the country's economy.

Net Capital Outflow

The difference between a country's savings and its domestic investments, representing the amount of money that flows out of the country to invest abroad minus the amount of money that flows into the country from foreign investors.

Net Exports

The value of a country's total exports minus its total imports; a measure of a nation's foreign trade balance.

Net Capital Outflow

The financial discrepancy between home country residents' investments in foreign lands and foreign investors' stakes in domestic assets.