MANAGERIAL ECONOMICS (LOOSELEAF)
5th Edition
ISBN: 9781337571371
Author: FROEB
Publisher: CENGAGE L
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Chapter 20, Problem 5MC
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Moral hazard problem.
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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.
[15]
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.
[14]
19. Expenditure on education and healthcare have, by far, the biggest redistributive effect in
South Africa' by one estimate dropping the Gini-coefficient by 10 percentage points.
Discuss the South African government's performance in health and education provision by
evaluating both the outputs and outcomes in these areas of service delivery. [15]
20. Define the following concepts and provide an example in each case: tax rate structure,
general…
Summarise the case for government intervention in the education market
Should Maureen question the family about the history of the home? Can Maureen access public records for proof of repairs?
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