I recently bought the foreign service exam study guide since I am taking the test this Friday. The test consists of, among other things, basic economics questions. I was so amused by one of the sample questions that I just had to share:
All of the following are examples of United States products that would typically fail to be produced to optimal output without government intervention EXCEPT:
A. national defense products.
B. light provided by lighthouses.
C. new automobiles.
D. new highways.
And in the answer section:
C. This is the correct answer. Automobiles are not a public good. Optimal production of automobiles is related to the demand for them by individual consumers.
Wednesday, June 10, 2009
A reader of the Planet Money blog reports on an unintentionally funny economics question: