When Analyzing Public Sector Decision Making, Economic Theory Assumes That

question 357

Multiple Choice

When analyzing public sector decision making, economic theory assumes that voters, politicians, and government officials will

• A) respond to changes in personal benefits and costs when making public sector choices.
• B) pursue the public interest even when it conflicts with their private interests.
• C) pursue primarily public interests because competition is less intense in the public sector.
• D) do none of the above.

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Definitions:

Price Elasticity

A measure of how much the quantity demanded of a good or service changes in response to a change in its price.

Price Elasticity

A measure of the responsiveness of quantity demanded or supplied of a good to a change in its price.

Midpoint Formula

A method used in economics to calculate the elasticity of demand or supply by taking the average of the initial and final prices and quantities.

Total Revenue

The total amount of money a company receives from its goods or services, calculated by multiplying the price per unit by the number of units sold.