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Exam 22: Frontiers of Microeconomics

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Question 191

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Table 22-8 -Refer to Table 22-8.The table shows the preferences of four types of voters over four possible outcomes: A,B,C,and D.In addition,the table shows the percentage of voters of each type.Suppose that,for some reason,D is eliminated as a possible option.Using a Borda count election,with 3 points for the best choice,2 points for the second best choice,and 1 point for the last choice,which outcome would win this election?

A) A
B) B
C) C
D) There would be a three-way tie.

E) A) and B)
F) B) and C)

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Question 192

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In economics,a difference in access to relevant knowledge is called a behavioral asymmetry.

A) True
B) False

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Question 193

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Which of the following is a characteristic of a corporation but not of a small family-owned business?

The science of economics is a finished jewel,perfect and unchanging.

Table 22-3 The citizens of Anytown will decide whether to build a new library,a new community center,or a new ice rink.Exactly one of the three choices will prevail,and the choice will be made by way of pairwise voting,with the majority determining the outcome on each vote.The preferences of the voters are summarized in the table below. -Refer to Table 22-3.If the citizens of Anytown use an instant runoff election. ,then they will build a new

The problem that arises when one person performs a task on behalf of another person is called the lemons problem.

Suppose a community is debating how much money to spend on improvements to the high school.The members of the community who have children advocate spending $20 million to make improvements.The remaining 60% of the community thinks the high school is just fine and does not want to spend anything.What will the outcome be?

The assertion that the median voter is "king" refers directly to the result established by the

Arrow's impossibility theorem illustrates the difficulties in creating the perfect voting system.

When each voter has a most-preferred outcome for the expenditure on a particular government program,majority rule will produce the outcome

Which of the following would violate transitivity?

Scenario 22-2 The following table shows the preferences for the five voters in a city regarding how to deal with the city's diseased trees. A = do nothing B = follow the expert's advice to remove every tree C = remove every 4th tree now and perhaps more later D = use an untested spraying alternative -Refer to Scenario 22-2.Consider the public policy for dealing with the diseased trees.Using pairwise majority voting with A versus B,then the winner of that vote versus C,then the winner of that vote versus D,which policy wins?

Arrow's impossibility theorem is "disturbing" in the sense that it proves that

In a vote between options A,B,and C,option C wins.When option B is eliminated and a vote is taken between option A and option C,option A wins.The voting system used fails to satisfy which of Arrow's properties of a desirable voting system?

A person's tendency to smoke a cigarette after promising himself that he will quit is an example of the behavioral economics insight that people are inconsistent over time

Table 22-14 The Johnson family is planning a vacation and,though Mr.and Mrs.Johnson will be paying for the trip,they have decided to use a democratic voting process to choose their destination.The family members' preferences are reflected in the table below. -Refer to Table 22-14.Mr.Johnson recommends using a vote by majority rule.If he wants to ensure that his 1st choice becomes the family's winning destination,he should propose

Evidence from studies of workers' choices on whether to participate in 401(k) plans suggests that the workers' behavior appears to exhibit

When a jeweler sells a low quality diamond to a young man who believes the diamond is the highest quality,she is engaging in

Table 22-15 The town of Portsmouth is considering a renovation to the high school.The voters in Portsmouth have different preferences on the budget for the renovation as displayed below. -Refer to Table 22-15.The median voter is one who prefers to spend

Table 22-10 Three family members -- Seamus,Maeve,and Siobhan -- are deciding what type of movie to attend.The three choices are an action adventure,comedy,or horror.The first,second,and third choices for each person are as indicated in the table below. -Refer to Table 22-10.Suppose the three decide to make the decision based on pairwise majority voting.If they first choose between Action and Horror and then choose between the winner of the first vote and Comedy,which movie alternative will win?