Eleanor and Abigail Finance Assingment Help With Solution

A deeply held belief in Europe is that university education should be financed almost entirely by the government. In France, undergraduates pay about $400 per year in tuition; in Germany, federal law explicitly forbids public universities to charge tuition. However, European governments typically don't provide much money for universities, leading to problems with maintaining quality. In response, some observers want to start charging students substantial amounts of tuition. One German official responded that “one of the prime rights of humanity is to have a free university education.” In the same way, a Labor member of the British parliament argued that “Introducing a market into higher education is something the Labor Party should not be doing” (Lyall, 2003, p. A3). Discuss the efficiency and equity consequences of a system of taxpayer-financed higher education.

The analysis surrounding Figure 7.1 assumes that public schooling is a “take-it-or-leave-it” option. That is, individuals are not allowed to supplement public education with private les-sons. Show how the diagram must be modified if, to the contrary, parents can purchase additional hours of education for their children who are enrolled in public school. Mother assumption behind the model is that public education is “free” in the sense that parents do not pay any taxes for it. Show how the model must be modified if public school is financed by taxes levied on parents.

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What are the different rationales given for government provision of education? Explain whether the rationales have different implications for government provision of higher education versus primary and secondary education.

Consider a society with three people (John, Eleanor, and Abigail) who use majority rule to decide how much money to spend on schools. There are three options for spending on a public park: H (high), M (medium), and L pow). These individuals rank the three options in the following way:

a. Consider all possible pairwise elections: M versus H, H versus L, and L versus M. What is the outcome of each election? Does it appear, in this case, that majority rule would lead to a stable outcome on spending on the public park? If so, what is that choice? Would giving one person the ability to set the agenda affect the outcome? Explain.
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b. Now suppose that Eleanor's preference ordering changed to the following: first choice = L, second choice = H, and third choice = M. Would majority rule lead to a stable outcome? If so, what is that choice? Would giving one person the ability to set the agenda affect the outcome? Explain.

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