Problem
If a community makes different spending decisions when offered a block grant or, alternatively, a categorical grant of equal size, we know that (a) The community reaches a higher level of social welfare under the block grant. (b) The categorical grant elicits more spending in the designated category than the block grant does. (c) The categorical grant elicits a level of community expenditures in the designated category equal to the size of the grant. (d) All of the above. Choose the relevant option and provide a detailed justification and a graphical illustration.
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.