Budget maximization by bureaus leads to
a. efficient budgets
b. budgets greater than those desired by median voters
c. budgets less than those desired by median voters
d. budgets equal to those desired by median voters
e. budgets less than those desired by the majority of voters
QUESTION 2Cost-plus pricing
a. is used only in oligopolistic market structures
b. simplifies pricing policy by adding a markup to average total cost
c. in actual practice leads to markups which are greater for more elastic demand curves
d. is likely to increase profits more than the use of marginal analysis
e. requires the firm to project the amount which will be sold and then mark-up the price based on average variable cost
QUESTION 3Which of the following is not a typical goal of bureaucrats?
a. increasing the size of their bureaus
b. gaining prestige
c. increasing the size of their staffs
d. increasing their bureaus' budgets
e. achieving greater efficiency
QUESTION 4During certain periods in the past few decades, if one of the three major breakfast cereal producers in the United States announced a price increase, the other two announced a similar price increase. This is a good example of
a. monopolistic competition
b. a cartel
c. a pure monopoly
d. the kinked demand curve model of oligopoly
e. the price leadership model of oligopoly
QUESTION 5According to William Niskanen, bureaucrats seek to
a. maximize profits
b. maximize tax revenues
c. maximize budgets
d. minimize variable costs
e. minimize total costs
QUESTION 6Historically, the U.S. steel industry has been a good example of
a. monopolistic competition
b. a cartel
c. a pure monopoly
d. the kinked demand curve model of oligopoly
e. the price leadership model of oligopoly
QUESTION 7In response to the threat of budget cuts, the Connecticut State Department of Recreation proposed shutting down many state parks and beaches. This is a good example of
a. cost efficiency in bureaus
b. Niskanen's theory of budget-maximizing bureaus
c. the median-voter model
d. logrolling
e. direct democracy