The optimal size of government is theoretically determined by following the principal that additional public sector activity is desirable only if the benefits of that activity exceed its opportunity cost. Valuation Problems Because of an absence of a price signal for government goods, it is sometimes very difficult to put a monetary value on the benefits of government goods. Who is paying for them and who is benefitting from them

The optimal size of government is theoretically determined by following the principal that additional public sector activity is desirable only if the benefits of that activity exceed its opportunity cost. Valuation Problems Because of an absence of a price signal for government goods, it is sometimes very difficult to put a monetary value on the benefits of government goods. Who is paying for them and who is benefitting from them

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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