Q19Governments continue to provide public support to some farmers, even in the absence of market failures. Choose the best explanation for this practice according to public choice theory.a.All consumers are willing to pay higher prices to provide financial support to some farmers.b.The marginal social cost of providing support is equal to the marginal social benefit.c.Vote-maximising governments are irrational in their response to powerful lobbying.d.Government support goes to consumers in the form of price controls, which balances the support given to farmers.e.The benefits of the support are concentrated among a small and vocal group of farmers and the costs are widely dispersed among millions of consumers.Clear my choice

Public choice takes the very rules that financial experts use to examine individuals' activities in…

Answered: Governments continue to provide public…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Q19

Governments continue to provide public support to some farmers, even in the absence of market failures. Choose the best explanation for this practice according to public choice theory.

All consumers are willing to pay higher prices to provide financial support to some farmers.

The marginal social cost of providing support is equal to the marginal social benefit.

Vote-maximising governments are irrational in their response to powerful lobbying.

Government support goes to consumers in the form of price controls, which balances the support given to farmers.

The benefits of the support are concentrated among a small and vocal group of farmers and the costs are widely dispersed among millions of consumers.

Clear my choice

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