PSC Public Policy Analysis 3

Question 1

In U.S. budgetary policy, 'mandatory spending' refers to expenditures that:

Accepted Answer

Are set by law and paid automatically without annual appropriations

Answer

Mandatory spending — including Social Security, Medicare, and Medicaid — is governed by permanent laws that automatically fund benefits for all eligible recipients without annual congressional appropriation votes.

Question 2

Which approach to healthcare policy is characterized by a single government entity paying for all healthcare services from tax revenues?

Accepted Answer

Single-payer system

Answer

In a single-payer system, the government collects taxes and acts as the sole insurer, paying providers directly — as in Canada's Medicare system — eliminating multiple private insurers.

Question 3

The Affordable Care Act (ACA) of 2010 primarily addressed healthcare access in the U.S. through:

Accepted Answer

Expanding Medicaid, creating insurance exchanges, and mandating coverage

Answer

The ACA expanded Medicaid to millions of low-income adults, established state insurance marketplaces, prohibited denial for pre-existing conditions, and introduced an individual mandate.

Question 4

Which term describes a situation where a government provides a benefit that leads people to take greater risks because they are protected from the consequences?

Accepted Answer

Moral hazard

Answer

Moral hazard occurs when protection from risk changes behavior — for example, bank bailout guarantees may encourage banks to make riskier loans because losses will be absorbed by taxpayers.

Question 5

Environmental policy often uses which economic concept to argue that polluters should pay for the harm they cause?

Accepted Answer

The polluter pays principle

Answer

The polluter pays principle holds that those who produce pollution should bear the costs of managing it to prevent damage to human health or the environment.

PSC - Political Science Certificate Practice Test

PSC - Political Science Certificate Practice Test

PSC Public Policy Analysis 3