When the Government Sells Something It Produces

question 51

Multiple Choice

When the government sells something it produces,

• A)revenue received must be greater than cost to justify government production
• B)revenue received must equal cost because government is a nonprofit organization
• C)the price does not always reflect the cost of producing the good
• D)the price charged is an accurate measure of the benefits generated
• E)it prices the good the same way a natural monopolist would

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Definitions:

Earn

To receive money as payment for work that has been done or to make a profit.

Simple Interest

Interest calculated only on the initial principal amount of an investment or loan, without compounding.

Third Payment

The payment that occurs as the third in a series or schedule of payments.

Borrowed

Refers to money obtained with an agreement to return it, usually with interest.