Principles of Economics 2e
2nd Edition
ISBN: 9781947172364
Author: Steven A. Greenlaw; David Shapiro
Publisher: OpenStax
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Textbook Question
Chapter 18, Problem 16CTQ
Given that rational ignorance discourages some people from becoming informed about elections, is it necessarily a good idea to encourage greater voter turnout? Why or why not?
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Is it rational for voters to be informed? Is it rational for them to vote? Discuss the incentives that
voters face and the calculations they might make. (Authentic answers with sources please)
BN10.3
Case:
Your non-profit has just been awarded a special government environmental clean-
up grant of $90,000. You are given the choice to take the $90,000 now or wait
until next year. With an election coming up, the amount of next year's grant will
vary based on which party wins. Assuming that money tomorrow is worth the
same as money today, the grant amounts are:
Outcome
Democrats control everything
Republicans control everything
Split government
Assume:
Grant Amount
$160,000
$36,100
$90,000
Probability
0.25
0.25
0.50
Assume your Payoff in each case (based on your utility function) is sqrt (grant
amount).
Question:
Do you accept the Money today or wait until next year? Include Calculations of
the Expected Value and Expected Utility.
As the Great Depression began in 1929, and millions of Americans found themselves in a terrible economic position, President Herbert Hoover was reluctant to involve the government in directly helping people. This decision helped lead to his loss in the presidential election of 1932. Put yourself in Hoover’s shoes—what reasons would he have for being opposed to large-scale government involvement in the economic lives of Americans? What reasons could be given for the government getting involved?
Chapter 18 Solutions
Principles of Economics 2e
Ch. 18 - Based on the theory of rational ignorance, what...Ch. 18 - What is the cost of voting in an election?Ch. 18 - What is the main factor preventing a large...Ch. 18 - Why might legislators vote to impose a tariff an...Ch. 18 - True or false: Majority rule can fail to produce a...Ch. 18 - Anastasia, Emma, and Greta are deciding what to do...Ch. 18 - Suppose there is an election for Soft Drink...Ch. 18 - How does rational ignorance discourage voting?Ch. 18 - How can a small special interest group win in a...Ch. 18 - How can pork-barrel spending occur in a situation...
Ch. 18 - Why do legislators vote for spending projects in...Ch. 18 - Why does a voting cycle make it impossible to...Ch. 18 - How does a government agency raise revenue...Ch. 18 - What are some reasons people might find acquiring...Ch. 18 - What are some possible ways to encourage voter...Ch. 18 - Given that rational ignorance discourages some...Ch. 18 - When Microsoft was founded, the company devoted...Ch. 18 - Representatives of competing firms often comprise...Ch. 18 - Special interests do not oppose regulations in all...Ch. 18 - To ensure safety and efficacy, the Food and Drug...Ch. 18 - How is it possible to bear a cost without...Ch. 18 - Is pork-barrel spending always a bad thing? Can...Ch. 18 - The United States currently uses a voting system...Ch. 18 - What are some alternatives to a first past the...Ch. 18 - AT10 million dollar. Lobbying Congress to block...Ch. 18 - Occupy Wall Street was a national (and later...Ch. 18 - Say that the government is considering a ban on...
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Similar questions
- Briefly explain why the principle that the majority of voters should decide an election outcome may not always make logical sense.arrow_forwardScholars and business people tend to agree that businesses should avoid politics because the economic stakes are too high. True Falsearrow_forwardWhat is meant by the concept "laboratories of democracy"? Why do you think state and local governments are excellent laboratories for applying comparative analysis when it comes to the study of state and local governments?arrow_forward
- Explain why majority rule respects the preferencesof the median voter rather than those of the averagevoter.arrow_forwardAssume you have been hired by a group that wants to increase voter turnout in American elections. What would you tell them about why some people are more likely to vote in elections compared to others who are not likely to participate?arrow_forwardArrow's impossibility theorem states that under certain assumptions about preferences, no voting system exists that satisfies all of the following properties: • Unanimity • Transitivity • Independence of irrelevant alternatives • No dictatorsarrow_forward
- What is the significance of the concept of rational ignorance? Question options: It explains why voters are swayed by single-issue voting. It explains why the majority of voters feel that their vote is important in determining the outcome of an election. It explains how false or exaggerated political advertising influences voting behavior. It explains why many people do not vote.arrow_forwardSuppose there are three people in society who vote on whether the government should undertake specific projects. Let the net benefits of a particular project be $150, $140, and $50 for persons A, B, and C, respectively. a. If the project costs $300 and these costs are to be shared equally, would a majority vote to undertake the project? What would be the net benefits to each person under such a scheme? Would total net benefits be positive? b. Suppose the project cost $375 and again costs were to be shared equally. Now would a majority vote for the project and total net benefits be positive? c. Suppose (presumably contrary to fact) votes can be bought and sold in a free market. Describe what kinds of results you might expect in part a and part b.arrow_forwardHow does Arrow's Impossibility Theorem challenge the feasibility of achieving a fair and consistent voting system in economic decision-making?arrow_forward
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