As Used in Governmental Accounting, Interperiod Equity Refers to a Concept

question 32

Multiple Choice

As used in governmental accounting, interperiod equity refers to a concept of

• A) providing the same level of services to citizens each year.
• B) measuring whether current year revenues are sufficient to pay for current year services.
• C) levying property taxes at the same rate each year.
• D) requiring that general fund budgets be balanced each year.

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Definitions:

Nonexcludable Good

A good that cannot be withheld from individuals once it has been provided, leading to free-riding issues.

National Defense

The protective measures and military actions that a country undertakes to defend itself against threats and maintain national security.

Market Failure

Occurs when the allocation of goods and services by a free market is not efficient.

Free-rider Problem

A situation in public economics where individuals consume a good without paying for it, leading to underproduction or depletion of the good, as seen often in public goods and common resources.