Which of the Following Is a Plausible Motivation for Explaining

question 75

Multiple Choice

Which of the following is a plausible motivation for explaining the budget-maximizing behavior of bureaucrats?

• A)Bureaucrats want to help the agency hire better lobbying firms and make contributions to members of Congress.
• B)Many agencies strive to attract budget resources that would otherwise go to their rival agencies.
• C)Bureaucrats want to help the department secretary finance his or her campaign for the presidency.
• D)Bureaucrats believe in the importance of fulfilling the mission of the bureaucracy and helping people in their community.

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Definitions:

Limits To Arbitrage

Constraints or factors that prevent investors from correcting a mispriced asset, often due to costs, risks, or regulatory barriers.

Siamese Twin Companies

Refers to two companies that are listed and traded separately on stock exchanges but are operationally dependent on the same assets or operations.

Closed-end Funds

Type of investment fund with a fixed number of shares that trade on a stock exchange, unlike open-end funds that continuously issue new shares or redeem existing shares.

Behavioral Finance

Models of financial markets that emphasize implications of psychological factors affecting investor behavior.