Question

Which of the following statements is TRUE of a cost-benefit analysis of a potential government project? a. Neither asset value increases to the property owners nor income increases to the property owners should be counted. b. Future costs and benefits should be discounted to present values before being compared. C. The net increase in jobs in a community is a benefit d. Both asset value increases to the property owners and income increases to the property owners should be counted. QUESTION 18 In 1996, legal changes reduced the ability of noncitizens to benefit from cash welfare programs. Evidence on the resulting changes in charitable support by chur a. crowd-out is significant because churches in high-immigrant areas increased their charitable spending much more than churches in low-immigrant areas. b.crowd-out is insignificant because churches in high-immigrant areas increased their charitable spending much more than churches in low-immigrant areas C. crowd-out is insignificant since there was no difference in the charitable spending of churches in high-immigrant areas and those in low-immigrant areas. d.crowd-out is significant since there was no difference in the charitable spending of churches in high-immigrant areas and those in low-immigrant areas. QUESTION 19 If the present discounted value of $400 next year is $380 this year, what is the implied rate of interest? a. 2.60% 6.5.26% C. 5% d. 2.56% QUESTION 20 Which factor is likely to prevent the private market from providing the optimal amount of a public good? a. large differences among individuals in their demand for the public good b. non-satiated preferences C. little to no difference among individuals in their demand for the public good d. the free rider problem

Answer 1

1. Option C is the answer. The net increase in jobs in a community is a benefit. Because when we see that its government duty to provide the employemee to the people of the country and generate various nechanism to fullfill the needs of talented and eligible people for job. And getting job to them can achieve the government goal.

2. Option B. In 1996, legal changes reduced the abillity of non citizens to benefits from cash welfare programmes because evidence shows that Crowd-out is insignificant because churches in high immigrants areas increased their charitable spending much more than churches in low immigrants areas.

3. Option B is the answer. Implied rate of interest is 5.26%.

4. Option D is the answer. Because i think private firms are meant for the profit maximization. But in public good free riders problem persist and if private firm give public goods then they have to loose their profit as well they can face losses due to free riders.