Managerial Economics
5th Edition
ISBN: 9781337681599
Author: Luke M. Froeb; Brian T. McCann; Michael R. Ward
Publisher: Cengage Limited
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Chapter 10, Problem 2MC
To determine
Attractive industry.
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17. The South African government's distributive stance is clear given its prioritisation of social
spending, which includes grants and subsidised goods. Discuss the advantages and
disadvantages of an in-kind subsidy versus a cash grant. Use a graphical illustration to
support your arguments.
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18. Redistributive expenditure can take the form of direct cash transfers (grants) and/or in-kind
subsidies. With references to the graphs below, discuss the merits of these two transfer
types in the presence and absence of a positive externality.
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19. Expenditure on education and healthcare have, by far, the biggest redistributive effect in
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evaluating both the outputs and outcomes in these areas of service delivery. [15]
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general…
Summarise the case for government intervention in the education market
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