Macroeconomics: Private and Public Choice
15th Edition
ISBN: 9781285453545
Author: Russell Sobel; Richard Stroup; James Gwartney; David Macpherson
Publisher: South-Western College Pub
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Question
Chapter 6, Problem 1CQ
To determine
Explain the voter’s information on the candidate’s position on issues.
Expert Solution & Answer
Explanation of Solution
The public choice analysis uses the economic methods and tools to analyze political problems in an economy. This is the study of political decision making that affects the formation of government. According to this study, the political decision making in an economy will be directed by the rational ignorance effect. The voters will be uninformed on many issues due to the presence of rational ignorance effect. As a result, such issues will not enter into their decision making process.
Otherwise, if voters have well information about the issues and the positions of candidates, then there is only zero chance of an individual vote to decide the city. Hence, it is very unlikely that voters will be well informed on issues and the positions of candidates.
Economics Concept Introduction
Rational ignorance effect: The rational ignorance effect indicates that the voters choose to remain uninformed. This is because the marginal cost of obtaining information is higher than the marginal benefit from knowing it.
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Students have asked these similar questions
Tasks
Exercise 1
Assess the following functions:
1. f(x)= x2+6x+2
2.f '(x)=10x-2x2+5
a. Find the stationary points. (5 marks)
b. Determine whether the stationary point is a maximum or minimum. (5 marks)
c. Draw the corresponding curves (5 marks)
Problem 2:
The sales data over the last 10 years for the Acme Hardware Store are as follows:
2003
$230,000
2008
$526,000
2004
276,000
2009
605,000
2005
328,000
2010
690,000
2006
388,000
2011
779,000
2007
453,000
2012
873,000
1. Calculate the compound growth rate for the period of 2003 to 2012.
2. Based on your answer to part a, forecast sales for both 2013 and 2014.
3. Now calculate the compound growth rate for the period of 2007 to 2012.
1. Based on your answer to part e, forecast sales for both 2013 and 2014.
5. What is the major reason for the differences in your answers to parts b and d? If you were to
make your own projections, what would you forecast? (Drawing a graph is very helpful.)
Exercise 4A firm has the following average cost: AC = 200 + 2Q – 36
Q
Find the stationary point and determine if it is a maximum or a minimum.b. Find the marginal cost function.
Chapter 6 Solutions
Macroeconomics: Private and Public Choice
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