Question

In: Economics

When considering the merits of employment resulting from a project, which of the following questions is...

When considering the merits of employment resulting from a project, which of the following questions is most important?

a. Could more jobs have been created if another project had been undertaken?
b. Will the persons employed by this project create more wealth than they would if employed in other areas?
c. Does the project increase total employment?
d. How many people does the project employ?

Government spending programs that create jobs are often popular because

a. when spending programs are funded by the government there are no secondary effects.
b. the benefits of job creation are always greater than the costs. Jobs are the key to economic progress.
c. the created jobs are highly visible, while the secondary effects of lost jobs in other areas, higher interest rates, and higher future taxes are less visible.
d. if a spending program is approved by Congress, it means that the value of what is produced is greater than the value of the resources used to produce it.

When the government funds a project that will create jobs, the funds for the project

a. will leave private sector output and employment unchanged.
b. are essentially free, because the project originated in the government sector.
c. will have to be either taxed or borrowed from the private sector.
d. will generate additional tax revenues that will pay for the project.

Solutions

Expert Solution

Question 1

The answer is option a. This is becasue the most important question that has to be asked from the employment side is whether the current project chosen will increase the employment more than any other projects would have. The second option is just a manifestation of this first option, but more to do with the wages side of the employment and not employment itself, more wealth will be created is a particular project offers more wages than the other available project options. The third option is also not valid bacause the project will definitely increase employment, even if it is by one unit. The question to be asked is whether the project increase total employment more than any other project. And the last option is also invalid as it is a question that is already asked by the first option.

Question 2

The answer is option c. When the government creates jobs, it is through projects the funding of which has to be done by borrowing from the people. This will lead to greater interest rates in future, which will cause crowding out of private investment and loss of jobs in the private sector, and higher tax rates in the future to recover the money spent in the project. However, these are effects that are not seen in the forefront and the main focus is always on the number of jobs created as a result of the project which is seen directly.

Question 3

The correct option is option c. This is because for any spike in government spending, the funds are always borrowed from the publc in the form of taxes. The private sector output and employment will undergo a change because massive public sector borrowing leads to crowding out of the private sector investment and that might create loss of jobs. The project will definitely not be free as it has to be funded from the public tax money. Such projects that generate employment will definitely increase the tax revenue by bringnig more people into the income tax base but these future tax revenue collections will not be for funding a project implemented before.


Related Solutions

Which of the following is true when the economy is at full employment?
Which of the following is true when the economy is at full employment?  The unemployment rate is equal to the natural rate of unemployment. The unemployment rate is equal to the cyclical rate of unemployment. The cyclical rate of unemployment is zero The unemployment rate is equal to zero The employment rate is 100% The natural unemployment rate is equal to zero
question 2 when considering the net cash inflows resulting from a capital budgeting decision taxes will:...
question 2 when considering the net cash inflows resulting from a capital budgeting decision taxes will: 1-increase the amount of the cash saving by tax rate 2-reduce the amount of the cash savings by (1-tax rate) 3-increase the amount of the cash savings by (1-tax rate) 4- reduce the amount of the cash saving by the (1+tax rate) 5- increase the amount of the cash savings by (1+tax rate) question 3 opportunity cost is a cost of capital for which...
Which of the following best describes valence? Select one: a. It is the consequence resulting from...
Which of the following best describes valence? Select one: a. It is the consequence resulting from performance or lack of performance. b. It is the perceived likelihood that employees' efforts will enable them to attain valuable goals. c. It is the perceived likelihood that performance will be followed by a particular outcome. d. It is the value the expected outcome holds for the person contemplating it. 
Which of the following are types of insurance companies purchase to help cover losses resulting from...
Which of the following are types of insurance companies purchase to help cover losses resulting from employee activity. Choose two A) Victim insurance B) Fidelity bonds C) Conformity bonds D) Casualty insurance
Answer the following questions. Polk Products is considering an investment project with the following cash flows:...
Answer the following questions. Polk Products is considering an investment project with the following cash flows: Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Cashflow -100 90 -25 -40 30 80 The company’s cost of capital is 10%, and it can get an unlimited amount of capital at that cost. What is the modified internal rate of return (MIRR) for the Project? Select one: a. 15.77% b. 10.80% c. 10.18% d. 6.03% e. 8.54%
Which of the following is INCORRECT when considering the lac repressor?
Which of the following is INCORRECT when considering the lac repressor?Binding to the operator site is cooperative.It is tetramer of two dimers.It is an allosteric protein.Binding of inducer forces the DNA-binding helices apart so they cannot contact the DNA-binding sites.Binding of each dimer is to different regions of the operator.
5.     In which one of the following lists are ALL items relevant when computing net employment...
5.     In which one of the following lists are ALL items relevant when computing net employment income? A.    Employee contributions to a registered pension plan; signing bonus on accepting employment; use of an employer-owned automobile. B.    Monthly automobile allowance; dental plan paid for by the employer; promotional cost incurred in selling the employer’s products. C.    Subsidized meals in employer’s facilities; life insurance paid by the employer; legal fees incurred to collect unpaid salary. D.    Tips and gratuities; dental insurance paid...
Summarize the qualitative risks of on‐time project completion considering the current employment and work environment in...
Summarize the qualitative risks of on‐time project completion considering the current employment and work environment in the U.S. Several members of your programming team live and work throughout the U.S., and are subject to the laws of those states. Additionally, some of the programming tasks could be modified and possibly sub‐contracted to India, Bulgaria, China, Argentina, and Indonesia.Discuss how the project manager should address cost/time trade‐offs associated with international outsourced completion of programming tasks. What criteria should be used to...
Define aneuploidy. Where (which parent), and when (which stage of meiosis) does the aneuploidy resulting in:...
Define aneuploidy. Where (which parent), and when (which stage of meiosis) does the aneuploidy resulting in: (a) Klinefelter syndrome (b) Down syndrome occur? Explain your answers
Determine the internal rate of return on the following​ project: An initial outlay of 9000 resulting...
Determine the internal rate of return on the following​ project: An initial outlay of 9000 resulting in a cash inflow of 1800 at the end of year​ 1, 4800 at the end of year 2, and 7800 at the end of year 3
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT