Which of the Following Is TRUE About the Effects of Democracy

question 16

Multiple Choice

Which of the following is TRUE about the effects of democracy?

• A) Democracy can perfectly align self-interest with the social interest.
• B) Because of democracy, there is no incentive for the public to align self-interest with the social interest.
• C) Democracy leads to good institutions that help align self-interest with the social interest.
• D) Democracy has no effect on the alignment between self-interest and the social interest.

---

Definitions:

Installment Sales Method

An accounting method where revenue is recognized at the time of cash collection rather than at the point of sale.

IFRS

International Financial Reporting Standards; a set of accounting standards developed by the International Accounting Standards Board that is becoming the global standard for the preparation of public company financial statements.

Cost Recovery Method

An accounting technique where revenue is recognized only after the costs of the sold goods or services are recovered, deferring profit recognition.

IFRS

A collection of accounting guidelines formulated by the International Accounting Standards Board (IASB) to assist in the creation of financial statements for public companies worldwide, known as International Financial Reporting Standards.