Public Administration

Question 1

Assume that the marker for tradable emissions permits by power plants has been operating efficiently for several years. An engineering firm then invents a lower cost device for pollution abatement. What happens to the equilibrium market price of a tradable permit? Why? Draw a supply and demand diagram, with a fixed supply of pollution permits, along with your answer. Has the socially optimal amount of pollution increased or decreased? Explain. Create a graph on a spreadsheet program (such as MS Excel), copy and paste it into a MS Word document, write your answer in the MS Word document, and upload it to Blackboard.

Your response should be at least 200 words in length. You are required to use at least your textbook as source material for your response. All sources used, including the textbook, must be referenced; paraphrased and quoted material must have accompanying citations.

Question 2

A city can subsidize commuting via public transit by giving public funds to buses and subways. A city also subsidizes commuting by car by spending public funds to maintain roads and bridges. How are total negative externalities affected by the public funding of buses and subways? How are negative externalities affected by public funding for roads and bridges? If a city wants to engage in corrective taxation, how might it adjust public subsidies of various methods of urban travel?

Your response should be at least 200 words in length. You are required to use at least your textbook as source material for your response. All sources used, including the textbook, must be referenced; paraphrased and quoted material must have accompanying citations.

Question 3

Suppose the position of political candidates on all issues can be ranked on a scale ranging from conservative too liberal. The more conservative a candidate, the less the quantity of public goods he will supply. Suppose as well, that all voters favoring liberal candidates will vote, while only 50% of those favoring conservative candidates will vote. Create a graph like the one in Figure 5.6 to show how the political equilibrium will differ from an election in which all citizens vote. Explain. Create a graph on a spreadsheet program (such as MS Excel), copy and paste it into a MS Word document, write your answer in the MS Word document, and upload it to Blackboard.

Your response should be at least 200 words in length. You are required to use at least your textbook as source material for your response. All sources used, including the textbook, must be referenced; paraphrased and quoted material must have accompanying citations.

Question 4

Suppose the marginal cost of pure public good increases as more is purchased by a community. Prove that the Lindahl equilibrium will result in a budget surplus at the efficient annual output of the pure public good.

Your response should be at least 200 words in length. You are required to use at least your textbook as source material for your response. All sources used, including the textbook, must be referenced; paraphrased and quoted material must have accompanying citations.

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