"Government Failure" Exists When Political Decision-Makers Choose Actions That

question 28

Multiple Choice

"Government failure" exists when political decision-makers choose actions that

• A) seek efficient outcomes rather than fair outcomes.
• B) seek fair outcomes rather than efficient outcomes.
• C) conflict with efficient allocation of resources.
• D) conflict with the outcome favored by the majority of voters.

---

Definitions:

Joint Stock Company

A type of business entity owned by shareholders where the stock can be bought and sold on stock exchanges.

Perpetual Existence

A corporate structure characteristic where a company continues indefinitely, unless dissolved, regardless of changes in ownership or management.

Implied Duration

Estimated time that represents how long it takes for the price of a fixed-income investment to be repaid by its internal cash flows.

Business Trust

A legal arrangement where assets are managed by trustees for the benefit of the trust's beneficiaries, often used in business for tax and estate planning.