15 Questions
What is the term used to describe a decision-making rule where individuals can choose what to do without requiring approval from their peers?
Minority rule
In a community where decisions are always made by a specific minority group, what is the result called?
Oligarchy
What percentage of the community's agreement is required under simple majority rule?
51%
Which decision-making rule has the advantage of only allowing Pareto-efficient changes to be approved?
Unanimous consent
Under which decision-making rule is it impossible for any individual to be made worse off while others are made better off?
Unanimous consent
What is the term used to describe a situation where political externalities are imposed on individuals who disagree with a decision made by a minority of citizens?
Oligarchy
What is the primary purpose of conducting a cost-benefit analysis for government investments?
To evaluate whether the return on the investment exceeds the opportunity cost
According to the passage, what is the main source of capital for a nation's physical infrastructure?
Governments
What is the key factor that determines whether additional investments in infrastructure or government programs will result in net benefits to society?
The return on the investment exceeding the opportunity cost
What is the purpose of creating a 'cost-benefit tableau' as described in the passage?
To list and evaluate all the costs and benefits of the investment over its lifetime
Which of the following best describes the role of the private sector in providing infrastructure according to the passage?
The private sector and governments both play significant roles in providing infrastructure
Which of the following is NOT mentioned in the passage as part of a nation's physical infrastructure?
Research programs
According to the passage, what is the primary motivation for business firms to provide some infrastructure and public services?
Profit and selling the output through the marketplace
What is the primary factor that determines whether additional government investments will result in net benefits to society?
The return on the investment exceeding the opportunity cost
According to the passage, which of the following is NOT a type of physical infrastructure mentioned?
Legal system
Test your knowledge on normative economics and the efficiency criterion, which are subjective and value-based branches of economics concerned with 'what should be' or 'what ought to be'. Understand how normative economics cannot make recommendations without an underlying theory of human behavior.
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