The Public Choice Model Can Be Used to Examine Voting

question 83

Multiple Choice

The public choice model can be used to examine voting models that contrast the manner in which collective decisions are made by governments (state, local, and federal) and the manner in which individual choices are made in markets.Which of the following descriptions is consistent with the difference between collective decision-making and decision-making in markets?

• A)Everyone who votes must agree with a decision made collectively through government, but in markets individuals can make their own choices.
• B)Individuals are less likely to see their preferences represented in the outcomes of government policies than in the outcomes of markets.
• C)The cost of a government policy is determined by a majority vote of members of the public; decisions made in markets are based on individual willingness to pay.
• D)Choices made through government policies are more important than decisions individuals make through markets.

---

Definitions:

Marginal Utility

The added delight or usefulness a person acquires by consuming an extra unit of a good or service.

Utility Theory

A concept in economics that suggests individuals make decisions based on the expected utility or satisfaction they will derive from those decisions.

Consumer Surplus

The disparity between what consumers are inclined and financially able to spend on a good or service compared to what they ultimately pay.

Marginal Utility

The boost in satisfaction or utility a person enjoys from consuming another unit of a good or service.