Public Choice Theory Suggests That Larger Special Interest Groups

question 235

Multiple Choice

Public choice theory suggests that larger special interest groups:

• A) will have fewer incentives to take into account the social costs of inefficient policies.
• B) will have more incentives to take into account the social costs of inefficient policies.
• C) will the same incentives as smaller groups to take into account the social costs of inefficient policies.
• D) will only consider the benefits of policies but not the costs.

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Definitions:

Vertical Analysis

A financial analysis technique that presents each item in a financial statement as a percentage of a base figure.

Net Income

The total profit of a company after all expenses and taxes have been deducted from revenues.

Vertical Analysis

A method in financial statement analysis where each line item is listed as a percentage of a base figure within the statement, allowing for the assessment of relative sizes and proportional changes over time.

Total Assets

The sum of all financial and physical resources owned by a business.