FISCAL ADMINISTRATION
CERTIFICATION EXAMINATION TEST
FULL QUESTIONS AND CORRECT
ANSWERS GRADED A
◉ Explain what defines a private good: Answer: a. Exhaustion - one
person's use of the good eliminates the possibility of someone else using
it. b. Exclusion - possible to separate non-payers from payers and deny
them use of the good.
◉ What is the classic example of a "negative externality"? Answer:
Second hand smoke
◉ What are 4 tools the government uses to encourage positive
externalities & discourage negative externalities? Answer: a. Taxes b.
Subsidies c. Regulations d. Provision of public goods
◉ Explain what a moral hazard is & give 1 example: Answer:
Incentivizing bad behavior; Savings & Loan crisis of the 1980's
◉ What is Drucker's classic quote regarding privatization (when
deciding whether a nongovernmental organization should deliver a
public service)? Answer: Privatization involves a "Make or Buy"
decision
, ◉ Explain what a "guarantor government" is: Answer: Government
guarantees the service but does not deliver it - contracting - government
finances but not does not directly provide the service - contracts with a
for-profit or non-profit provider to deliver the service or program.
◉ In regards to Lessons Learned / Best Practices, what is significant
about public managers? Answer: Requires a different skill set for public
managers (managing the contract and contractor not the service)
◉ What is important to know about Kaldor-Hicks Compensation
Principle? Answer: The gainers gain and losers lose but theoretically, the
losers can be compensated in such as way that there is a net gain among
everyone.
◉ Explain Dillon's Rule & explain the distinction between state & local
federal law: Answer: If state law is silent about a particular local power,
the presumption is that the local level lacks the power. If the U.S.
Constitution/federal law is silent on the matter; states can generally take
action in that area of public policy.
◉ Explain what a Price Index is: Answer: Utilizes a base year & then
enables you to determine how much of spending in a later year is due to
real change in spending (spending changes driven by increased
spending) & how much is driven by price changes - inflation. Vital to
determining our real level of spending and actual purchasing power.
CERTIFICATION EXAMINATION TEST
FULL QUESTIONS AND CORRECT
ANSWERS GRADED A
◉ Explain what defines a private good: Answer: a. Exhaustion - one
person's use of the good eliminates the possibility of someone else using
it. b. Exclusion - possible to separate non-payers from payers and deny
them use of the good.
◉ What is the classic example of a "negative externality"? Answer:
Second hand smoke
◉ What are 4 tools the government uses to encourage positive
externalities & discourage negative externalities? Answer: a. Taxes b.
Subsidies c. Regulations d. Provision of public goods
◉ Explain what a moral hazard is & give 1 example: Answer:
Incentivizing bad behavior; Savings & Loan crisis of the 1980's
◉ What is Drucker's classic quote regarding privatization (when
deciding whether a nongovernmental organization should deliver a
public service)? Answer: Privatization involves a "Make or Buy"
decision
, ◉ Explain what a "guarantor government" is: Answer: Government
guarantees the service but does not deliver it - contracting - government
finances but not does not directly provide the service - contracts with a
for-profit or non-profit provider to deliver the service or program.
◉ In regards to Lessons Learned / Best Practices, what is significant
about public managers? Answer: Requires a different skill set for public
managers (managing the contract and contractor not the service)
◉ What is important to know about Kaldor-Hicks Compensation
Principle? Answer: The gainers gain and losers lose but theoretically, the
losers can be compensated in such as way that there is a net gain among
everyone.
◉ Explain Dillon's Rule & explain the distinction between state & local
federal law: Answer: If state law is silent about a particular local power,
the presumption is that the local level lacks the power. If the U.S.
Constitution/federal law is silent on the matter; states can generally take
action in that area of public policy.
◉ Explain what a Price Index is: Answer: Utilizes a base year & then
enables you to determine how much of spending in a later year is due to
real change in spending (spending changes driven by increased
spending) & how much is driven by price changes - inflation. Vital to
determining our real level of spending and actual purchasing power.
