PT135.S1.Q7

PrepTest 135 - Section 1 - Question 7

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Economist: Government intervention in the free market in pursuit of socially desirable goals can affect supply and demand, thereby distorting prices. ███ ██████ ██ ████ ████████████ ██ ██████████ ██ ████ ██ █████████████ ██████████ ████ █████████ ████ ███████ ██ ████ ██ ██████████ ████████ ██ ███ ███ ██ █ ████ ██ ████████ ██ █████████ █████████ ████ ████ ███ ██████ █████ ██ █████████████ ████ ███████ ████ ███ ████ ██████████ ██████████ ████████████ ██ ███ ████ ██████ ██ █████████ ████ ████ ██ ████████

Summary

The author draws an analogy between the ethics of administering medicine and the ethics of government intervention. Since most medicines have both harmful and beneficial effects, using a medicine is justified only when not using it would cause a lot more harm than using it. Similarly, since government intervention in the free market for the purpose of social engineering can distort prices, such intervention is justified only when failure to intervene causes a lot more harm than the intervention.

Strongly Supported Conclusions

We’re looking to fill in the concerning what is required in order for government intervention in the free market to be justified. Based on the analogy to medicine, we can conclude that government intervention is justified only when the failure to intervene is a lot more harmful than intervention.

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7.

Which one of the following ████ █████████ █████████ ███ █████ ████████ ██████

a

would likely be ████████ ██ ██ ███ ████████ ██ ███ ████████ ████████████

b

has been shown ██ ████ ███ ██ ███ █████████████ ███████ ███████

c

is believed unlikely ██ █████████████ ██████████ ███ ████████ ████████

d

would do less ██████ ████ █████ ██████ ████ ███ ████████████ ███ ███████████

e

provides a solution ██ ████ █████████ █████████ ███████

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