A consequence of federal civil service buyouts during

12. A consequence of federal civil service buyouts during the 1980’s (civil
servants would agree to quit or take early retirement in return for a cash
payment) was:
a. That productivity increased exponentially
b. That the worst workers quit
c. That the best workers quit
d. The rate of resignations increased
13. Perfectly competitive markets are fully characterized by:

14. The following is a policy solution to the under‐provision of a good with
positive externalities:
Based on this graph, answer question 15
15. If a Pigouvian tax is implemented to correct the negative externality, the new
producer surplus (after the tax) would be:
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Part II. True/False . (5 points each, 20 total)
Discuss the following statements analytically. Your answer should explain
aspects of the statement that are correct (if any) and aspects of the statement
that are false (if any).
16. Vancouver city government provision of bus transportation is best justified
by the fact that bus transportation is a public good.
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