Which of the Following Is NOT a Valuable Role of Government

question 11

Multiple Choice

Which of the following is NOT a valuable role of government in a free market society?

• A) To reduce negative externalities.
• B) To enhance rent-seeking activities.
• C) To reduce market power.
• D) To provide public goods.

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Definitions:

Coase Theorem

A principle suggesting that if transaction costs are low, private bargains will efficiently resolve the allocation of resources and distribution of goods.

Zoning Ordinance

Legislation that divides an area into zones to specify allowable land uses and regulate building standards, to shape urban growth and land use.

Socially Optimal

A situation in which resources are allocated in the most efficient manner from the perspective of society as a whole.

Subsidize

Financial support extended by a government or organization to lower the production costs or price of goods and services, making them more accessible to the public.