Consider the four basic questions of public finance listed in the chapter. Which of these questions are positive—questions that can be proved or disproved—and which are normative—questions of opinion? Explain your answer.
Answer to relevant QuestionsOne rationale for imposing taxes on alcohol consumption is that people who drink alcohol impose negative spillovers on the rest of society—for example through loud and unruly behavior or intoxicated driving. If this ...The urban African-American community is decidedly split on the subject of school vouchers, with their leaders comprising some of the most vocal proponents and opponents of increased school competition. Why do you think this ...Explain why a consumer’s optimal choice is the point at which her budget constraint is tangent to an indifference curve. Consider Bill and Ted, the two citizens in the country of Adventure land described in Problem 9 from Chapter 1. Suppose that Bill and Ted have the same utility function U(Y) = Y1/2, where Y is consumption (which is equal to ...A researcher conducted a cross-sectional analysis of children and found that average test performance of children with divorced parents was lower than average test performance of children of intact families. This researcher ...
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