Question

Why might a politician start a costly spending program if its costs exceed its social benefits? The costs cannot be measured therefore the politicians focus on the benefits which are explicit. The politician is trying to find ways to raise more money for the next election. Voters do not care about the costs of programs, as long as their taxes do not go up. The politician gains prestige and voters are not well informed of the benefits and costs.

please answer both!

Answer 1

1. Option 4. The politician gains prestige and voters are not well-informed of the benefits and costs

Explanation: The politician gains respect because of starting the project as voters do not always have access to sufficient information regarding costs and benefits.

2. Option 3. The costs and benefits of being efficient are the same whether one is in the private sector or in the public sector.

Explanation: In public choice theory, economic concepts are used in the arena of public policies.