Why Are Special Interest Groups So Powerful

question 18

Multiple Choice

Why are special interest groups so powerful?

• A) Because voters are rationally ignorant about how laws designed to help special interest groups are harmful to everyone else.
• B) Because special interest groups have a self-interest in passing favorable legislation-they stand to gain millions of dollars, while each taxpayer loses only several dollars.
• C) Neither of these explanations is correct.
• D) Both of these explanations are correct.

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Definitions:

Asset

Resources owned by a company that have economic value and can provide future benefits, such as cash, inventory, and equipment.

Liability

A liability refers to financial obligations or debts that a company owes and is required to repay in the future.

Accounting Equation

The fundamental equation of accounting, Assets = Liabilities + Shareholder's Equity, representing the relationship between a company's resources and claims against those resources.

Supplies

Items that are consumed or used up in the daily operations of a business, like office supplies or manufacturing materials.