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Requirement: I expect you to provide a well-organized and convincing narrative, including proper sentence structure, grammar, and punctuation.Repeating the question as part of your answer is unlikely to improve the quality of your response. I will also not look favorably on bulleted lists, sentence fragments, or other short-hand devices more suitable to an outline than a short essay.You are encouraged to prepare a file card for the exam, with any information on it that you believe will be helpful.

Question 1. During the past few weeks, we have discussed a number of examples of rent-seeking behavior by individuals or firms.Please provide a reasonably complete description one such effort, including the following: the type of rent sought, a brief microeconomic explanation of the mechanism involved, the government action anticipated, and the impacts on other economic actors as well as overall economic efficiency.

Question 2. The federal government provides a number of programs that help those in the United States who live in poverty, including Temporary Assistance for Needy Families (TANF).Explain how this program differs from its predecessor – Aid for Families with Dependent Children (AFDC).Would including housing subsidies as a part of TANF have a distortionary impact on poor families’ consumption choices? Explain.

Question 3. For a number of years, pundits (and some economists) have predicted that the Social Security retirement system will fail at some future date. Explain why the current system is considered to be in trouble, noting the demographic and societal changes that have contributed to this situation.Outline a couple of modifications to the system that may stabilize it for the long run, so that current workers can confidently expect to receive benefits when they retire.

Question 4. Briefly explain the U.S. government spending process, including the various steps and approvals required.Make sure to discuss the three types of bills – budget, authorization, and appropriation, and to describe the contribution of the President and the two branches of the legislature.Be sure to mention what our government representatives can do in the event that the fiscal year starts before they have completed their legislative work.

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