Simple Majority Voting Sometimes Leads to Projects Being Undertaken Whose

question 110

Multiple Choice

Simple majority voting sometimes leads to projects being undertaken whose costs are greater than the benefits.How is this possible?

• A) It is not possible,unless the voting results are rigged.
• B) Because voters have no way to express the intensity of their preferences.
• C) Because many voters choose to be rationally ignorant.
• D) Because free riding is pervasive.

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Definitions:

Purely Competitive

A market structure characterized by many buyers and sellers, homogeneous products, and free entry and exit of firms.

Short Run

A period in which at least one factor of production is fixed, affecting the ability of a business to increase output in response to increased demand.

Marginal Cost Curve

A graphical representation showing how the cost to produce one additional unit of a good changes as production increases.

Average Total Cost (ATC)

The total cost of production (fixed and variable costs) divided by the total quantity of output produced.