Q&A Hero

Q: The process of influencing public officials to promote or secure the passage or defeat of legislation is known as a. bribery. b. activism. c. lobbying. d. suffrage.

Q: Which of the following is not a major approach that business uses to influence government? a. lobbying b. PACs c. coalition building d. vigilance

Q: Participation in the formulation and execution of public policy at various levels of government is a. available only to individual citizens. b. required by the constitution. c. the definition of lobbying. d. the definition of political involvement.

Q: The power of businesses to drive the political agenda in Washington, D.C. is now a. subject to special interests. b. virtually unchecked. c. largely impeded. d. in government's interest.

Q: When a business assumes an advocacy role for its interests, it is a. doing what is normal and expected. b. breaking the law. c. operating at the trade association level. d. allowing government to influence it.

Q: Lobbyists often provide all of the following services, except: a. create slick advertisements. b. conduct indirect-mail campaigns. c. provide access to lawmakers. d. draft legislation.

Q: Astroturf lobbying is massively regulated. a. True b. False

Q: One effective strategy used by the NRA was its shutting down of scientific studies involving gun injuries. a. True b. False

Q: One strategy for corporate political action is constituency building. a. True b. False

Q: A political strategy for public activism is keeping an issue off the public agenda by providing no information to policymakers. a. True b. False

Q: The argument in favor of unlimited corporate political spending is based on the right to free speech. a. True b. False

Q: Unlimited corporate political spending was made legal by the Citizens United decision of the U.S. Supreme Court. a. True b. False

Q: PACs are uniformly well thought of in American society. a. True b. False

Q: Today, many major U.S. corporations avoid paying taxes by utilizing offshore tax loopholes. a. True b. False

Q: Leadership PACs are connected PACs. a. True b. False

Q: PACs allow labor to organize their giving. a. True b. False

Q: The money that PACs donate to political candidates has brought about great benefit to the political system. a. True b. False

Q: Individuals are less restricted in their contributions to political candidates than are PACs. a. True b. False

Q: Recent Supreme Court decisions have restricted the activity of PACs a. True b. False

Q: An umbrella organization has a broad base of membership that represents businesses in several different industries. a. True b. False

Q: Because it represents a homogenous group of businesses, the NFIB is able to present a unified message when lobbying Congress. a. True b. False

Q: Because of the difficulty in coordinating the effort, grassroots lobbying is no longer used extensively. a. True b. False

Q: To be effective, grassroots lobbying must be genuine. a. True b. False

Q: Lobbyists are affectionately known as "influence peddlers." a. True b. False

Q: Lobbying takes place only at the federal government level. a. True b. False

Q: Lobbyists are generally interested in the common good. a. True b. False

Q: For large corporations today, political involvement is imperative. a. True b. False

Q: The way in which most legislation gets passed is through special-interest politics. a. True b. False

Q: Government is not a central stakeholder of business. a. True b. False

Q: Describe the history of the U.S. government as to industries in distress.

Q: Articulate a brief history of government's role in business.

Q: Given information from this chapter, can governments manage more ethically than capitalism?

Q: Regulation imposes new costs on business, including direct, indirect, and induced costs. Which type of additional cost is most important to consider in the regulation process?

Q: Using the arguments for and against industrial policy, discuss the benefits and detriments of government support for the hydrogen economy (i.e., using hydrogen as a primary source of fuel to replace oil).

Q: Industrial policy sometimes allows, or requires, government financial assistance to certain industries (e.g., the airline industry or the railroad industry). In addition to industry-wide assistance, the government has on occasion provided bailouts for individual firms. Is bailing out a specific company an appropriate use of government regulation?

Q: According to the authors, the tension between business and government is "a clash of ethical systems." If it is, compare such a viewpoint with Neil Jacoby's comments provided in the text.

Q: Why does government regulate business?

Q: Discuss the reasons for the overlapping trends of regulation and deregulation.

Q: Is privatization always effective or successful? Give examples of a success and a failure.

Q: Compare and contrast economic regulation and social regulation.

Q: One reason that government might regulate business is to control excessive competition. Government also regulates business to control natural monopolies. Which situation is worse--monopoly or excessive competition?

Q: In an economy that says it seeks to maximize profits for the individual firm, how can the United States government justify regulating business to control excess profits?

Q: Distinguish between producing a service and providing a service. Why is this distinction important in the debate over privatization?

Q: Discuss the likelihood that the United States can develop a planned, successful industrial policy.

Q: Who determines the public interest?

Q: Discuss the ability of the public or its government to establish social priorities.

Q: Why is it incumbent upon government to promote social goals such as safe working environments, clean air, and safe products?

Q: Which of the following is not an effect of induced costs? a. small businesses may be adversely affected. b. new agencies may be created. c. new investments in plant and equipment may be affected. d. innovation may be affected.

Q: Arguments against privatization include all of these except: a. social goals. b. service provisions. c. public backlash. d. safety concerns.

Q: The newer form of industrial policy is exemplified by: a. a focus on enabling industrialization. b. Karl Aiginer's book, "Industrial Policy: A Dying Breed or a Re-emerging Phoenix?" c. policy that does not conflict with widely held view on the role of government in the economy. d. Robert Reich's book, "The Next American Frontier."

Q: A 2015 Pew research survey found that respondents think the government is doing well on many issues except a. setting workplace standards. b. protecting the environment. c. keeping us safe from terrorists. d. cutting corporate taxes.

Q: Which of the following is not a role increasing government's complex relationship with business? a. government is a major purchaser. b. government can elevate some businesses while devaluing others. c. government cannot have buying power d. government can create new businesses through subsidization.

Q: Which of the following industries has not been affected by deregulation? a. financial services. b. trucking c. computer software d. airline

Q: The dilemma of deregulation is a. to enhance competition within the industry without harming workers' status. b. to enhance competition within the industry without sacrificing applicable social regulations. c. to prevent monopolies without allowing hypercompetition. d. to provide business more freedom without completely abandoning governmental authority.

Q: The primary purpose of deregulation is to a. decrease competition in the affected industries. b. remove certain industries from old-line economic regulations. c. protect the natural environment. d. allow natural monopolies to form.

Q: Which of the following is not considered a part of the induced costs of regulation? a. the effect on innovation b. the effect on investments in plant and equipment c. the effect on small business d. the effect on consumers

Q: Direct costs of regulation are most visible when we look at the number of new agencies created, aggregate expenditures, and a. global influence. b. growth patterns. c. community response. d. resource spending.

Q: A 2015 Pew research survey found over 50% of respondents thought that the federal government was doing well in all areas except a. responding to national disasters. b. ensuring safe food and medicine. c. corporate bailouts. d. ensuring access to education.

Q: Social regulation's focus on people encompasses their roles as all of the following except a. employees. b. consumers. c. citizens. d. business owners.

Q: Governmental regulations that seek to further societal objectives are examples of a. social regulation. b. economic regulation. c. environmental control. d. central planning.

Q: Government regulation of business through the control of economic or market variables is a form of a. negative externality. b. social cost. c. economic regulation. d. indirect cost.

Q: Negative externalities are often referred to as a. full absorption costs. b. social costs. c. allocated costs. d. environmental costs.

Q: Government intervention in monopolistic industries is often brought about by a. requests from smaller competitors. b. class-action lawsuits. c. anticompetitive practices. d. frequent bankruptcies within the industries.

Q: A market in which the economies of scale are so great that the largest firm has the lowest costs and is able to drive out competitors is called a(n) a. natural monopoly. b. market failure. c. externality. d. deregulated industry.

Q: Which of the following is not a major reason given for governmental regulation? a. controlling natural monopolies b. controlling negative externalities c. achieving social goals d. maintaining a trade surplus with foreign countries

Q: The primary reason for government regulation of business is a. hypercompetition. b. central planning of the economy. c. market failure. d. lobbying efforts by business.

Q: The act of governing or bringing under the control of law or constituted authority is called a. regulation. b. despotism. c. central planning. d. dictatorship.

Q: Government regulations have been criticized for all the following reasons except a. being too extensive. b. being too costly. c. being burdensome to business. d. being ineffective.

Q: All of the following are reasons that government regulation of business is needed except a. to ensure that customers and employees are treated fairly. b. maintain competitive markets. c. to protect the environment. d. to ensure that customers and employees are not exposed to unreasonable hazards.

Q: Government attempts to persuade business to act in the public interest are called a. monetary policies. b. moral suasion. c. standard setting. d. transfer payments.

Q: Government payments to industries or groups with special qualifications are called a. transfer payments. b. subsidies. c. loan guarantees. d. moral suasion.

Q: Government influences business through all of the following nonregulatory methods except a. being a major employer. b. being a standard setter. c. requiring equal employment opportunities be granted to job applicants. d. providing transfer payments.

Q: The opposite of privatization could be considered a. creeping expropriation. b. industrial policy. c. subsidization. d. federalization.

Q: There has always been a strong reaction in the United States to any form of industrial policy because: a. It reduces the market's efficiency. b. It conflicts with the widely held view of government's role in the economy. c. Existing attempts to form industrial policies have generally been irrational and uncoordinated. d. Industrial policies violate anti-trust legislation.

Q: Industrial policy is: a. by default. b. a powerful nonregulating approach by government to influence business. c. non debatable. d. consistent in each government administration.

Q: A strong industrial policy: a. is present in most developing countries. b. is a term heard continuously. c. is government intervention. d. helps firms compete in a fast-moving global economy.

Q: Arguments against industrial policy include all of the following except a. reduces market efficiency b. The need to rescue "sunset" industries. c. the need to promote "sunrise" industries. d. foreign industrial policy success has been variable.

Q: Arguments for industrial policy include all of the following except a. for economic reform. b. making government more efficient. c. making government more effective. d. stifling innovation.

Q: The question of whether current public functions should be performed by the government or private sector is addressed by a. industrial policy. b. privatization. c. central planning. d. moral suasion.

Q: Every form of state intervention that affects industry as a distinct part of the economy is called a. internationalization. b. globalization. c. industrial policy. d. privatization.