Microeconomics
21st Edition
ISBN: 9781259915727
Author: Campbell R. McConnell, Stanley L. Brue, Sean Masaki Flynn Dr.
Publisher: McGraw-Hill Education
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Chapter 5.A, Problem 1ADQ
To determine
Affirmative and negative majority votes and inefficient allocation of resources.
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Suppose demand and supply are given by: (LO3, LO4)Qx d = 14 − 1/2Px and Qx s = 1/4Px − 1c. How much tax revenue does the government earn with the $12 tax when the new equilibrium quantity is 2 units after tax .
Explain how affirmative and negative majority votes can sometimes lead to inefficient allocations of resources to public goods. Is this problem likely to be greater under a benefits-received or under an ability-to-pay tax system? Use the information in Figures 17.1a and 17.1b to show how society might be better off if Adams were allowed to buy votes.
4.12. A social choice function satisfies the bottom criterion if, whenever a candidate is not at the bottom of the preference list of any voter,that candidate is a winner.(a) Does the plurality method satisfy the bottom criterion?(b) Does the antiplurality method satisfy the bottom criterion?(c) Explain why it is impossible for a social choice function with three ormore candidates to satisfy both the bottom criterion and the Paretocriterion.
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- Suppose George made $20,000 last year and that he lives in the country of Harmony. The way Harmony levies income taxes, each citizen must pay 10 percent in taxes on their first $10,000 in earnings and then 50 percent in taxes on anything else they might earn. So given that George earned $20,000 last year, his marginal tax rate on the last dollar he earns will be __________ and his average tax rate for his entire income will be _________________. a. 50 percent; 50 percent. b. 50 percent; less than 50 percent. c. 10 percent; 50 percent. d. 10 percent; less than 50 percent.arrow_forwardurgent 1.15. Consider the Supreme Court as an electorate of 9 members thatvotes yes-or-no on a variety of issues. It is customary for this electorateto use the simple majority method, and since 9 is an odd number, no tiescan result when no justices are absent. Imagine the following alternativemethod for determining Supreme Court decisions. The decision is affirmative whenever at least 3 of the first 5 justices vote to affirm. Otherwisethe decision is negative. This is just the bloc voting method, where thejustices form blocs of size 5, 1, 1, 1, and 1. (This method emulates whatwould occur if the first 5 justices were to agree to always vote as a blocand to decide among themselves how the bloc should rule.)(a) Is this method anonymous?(b) Is this method neutral?(c) Is this method monotone?(d) If you were one of the 4 justices not among the first 5, why wouldyou complain about this voting method?arrow_forward2.9. The following informal descriptions of voting methods do not represent social choice functions as we have defined them. Explain why not.(a) (Mini-quota) Any candidate with at least 25% of the votes is declareda winner.(b) (Approval voting) Every voter answers a yes-or-no question abouteach candidate: “Is she acceptable?” Whichever candidate is acceptable to the most voters is declared the winner.(c) (Copeland without ties) The winners of the Copeland method become our finalists. If there is more than one finalist, the tie is resolvedby drawing straws.(d) (Condorcet candidate) Pick the candidate who defeats each of theother candidates in a head-to-head electionarrow_forward
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