The Three Problems Facing a Government Trying to Determine the Optimal

question 3

Multiple Choice

The three problems facing a government trying to determine the optimal quantity of a public good include all of the following EXCEPT:

• A) preference revelation because individuals may not tell the government their true valuation of the public good.
• B) preference knowledge because individuals may not know their true valuation of the public good.
• C) preference implementation because it is hard to produce public goods in practice.
• D) preference aggregation because it is difficult to add up the preferences of millions of citizens.

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Definitions:

Jay's Treaty

A 1795 treaty between the United States and Great Britain that sought to settle outstanding issues from the American Revolutionary War and facilitate ten years of peaceful trade between the nations.

Impressment

The British navy’s practice of using press-gangs to kidnap men in British and colonial ports who were then forced to serve in the British navy.

British Imports

Goods or services brought into a country from the United Kingdom for sale or use.

French Revolution

A period of far-reaching social and political upheaval in France (1789-1799) that ultimately led to the end of monarchy, rise of democracy, and radical socio-political changes.