Question 1

Which of the following is not a typical solution to the "Tragedy of the Commons?"

Accepted Answer

A)   taxing the use of the common resource
B)   turning the common resource into a club good
C)   turning the common resource into a private good
D)   regulating the use of the common resourceE) A) and D)
F) C) and D)

Question 2

Pete is a non-union employee at The Electric Co. The majority of the employees at The Electric Co. are unionized. The union at The Electric Co. has negotiated very good benefits. Even though he is not a union member and he does not have to pay union dues, Pete receives all the benefits that the union has negotiated. Pete's behavior is an example of

Accepted Answer

A)   rivalry.
B)   a barrier to entry.
C)   free riding.
D)   Taft-Hartley opposition.E) A) and D)
F) A) and B)

Question 3

"Given that most people like to get 'free stuff,' it follows that goods that are available free of charge are produced and consumed in the proper amounts in a market economy." What is wrong with this statement?

Accepted Answer

In the absence of government interventio...

Question 4

Most lighthouses are operated by the government because

Accepted Answer

A)   of the free-rider problem.
B)   lighthouses are no longer valued by society.
C)   most lighthouses are only tourist attractions in state and national parks.
D)   shipping companies would not be able to afford maintenance fees for lighthouses.E) A) and D)
F) A) and C)

Question 5

Figure 11-1
 
-Refer to Figure 11-1. A gym membership at a gym that always has space in classes and on machines is an example of the type of good represented by Box

Accepted Answer

A)   A.
B)   B.
C)   C.
D)   D.E) C) and D)
F) B) and C)

Question 6

On hot summer days, electricity-generating capacity is sometimes stretched to the limit. At these times, electric companies may ask people to voluntarily cut back on their use of electricity. On these days, electricity is

Accepted Answer

A)   excludable, but nonrival in consumption.
B)   not excludable, but rival in consumption.
C)   excludable and rival in consumption.
D)   not excludable and nonrival in consumption.E) B) and D)
F) A) and D)

Question 7

Which two types of goods are excludable?

Accepted Answer

Private go...

Question 8

The greatest difficulty with cost-benefit analysis of a public project is determining

Accepted Answer

A)   whether government revenue is sufficient to cover the cost of the project.
B)   which contractor should be awarded the project.
C)   the cost of the project.
D)   the value or benefit of the project.E) None of the above
F) All of the above

Question 9

Drivers have to pay a toll to drive on certain roads. In essence, a toll is a corrective tax on the externality of __________.

Accepted Answer

The answer of Drivers have to pay a toll to...

Question 10

Four roommates share an off-campus house and equally share the cost of rent. Everyone says that she values a clean house, yet the house is usually dirty. To an economist, a clean house in this case represents

Accepted Answer

A)   a common resource problem.
B)   a public good.
C)   a natural monopoly.
D)   All of the above are correct.E) A) and B)
F) B) and C)

Question 11

Because elephants roam freely in many countries in Africa, each individual African elephant poacher has

Accepted Answer

A)   a strong incentive to kill as many elephants as he can find.
B)   a strong incentive to protect the elephants.
C)   the ability to save the elephants.
D)   None of the above is correct.E) C) and D)
F) A) and C)

Question 12

Cost-benefit analysis is important to determine the role of government in our economy because

Accepted Answer

A)   the government should provide all goods for which the benefits exceed the costs.
B)   cost-benefit analysis identifies the possible gains to society from government provision of a particular good.
C)   markets for private goods cannot effectively assign costs and benefits.
D)   cost-benefit analysis is the best tool to identify market failures.E) A) and C)
F) A) and D)

Question 13

Recall the four types of goods. Are national defense and a patented invention the same type of good? Briefly explain.

Accepted Answer

No. National defense...

Exam 11: Public Goods and Common Resources

On hot summer days, electricity-generating capacity is sometimes stretched to the limit. At these times, electric companies may ask people to voluntarily cut back on their use of electricity. On these days, electricity is

Correct Answer
verified

Correct Answer
verified

Which of the following is not a typical solution to the "Tragedy of the Commons?"

Correct Answer
verified

Four roommates share an off-campus house and equally share the cost of rent. Everyone says that she values a clean house, yet the house is usually dirty. To an economist, a clean house in this case represents

Correct Answer
verified

Most lighthouses are operated by the government because

Correct Answer
verified

Cost-benefit analysis is important to determine the role of government in our economy because

Correct Answer
verified

Which two types of goods are excludable?

Correct Answer
verified
Private go...
View Answer

Because elephants roam freely in many countries in Africa, each individual African elephant poacher has

Correct Answer
verified

Drivers have to pay a toll to drive on certain roads. In essence, a toll is a corrective tax on the externality of __________.

Correct Answer
verified

Recall the four types of goods. Are national defense and a patented invention the same type of good? Briefly explain.

Correct Answer
verified
No. National defense...
View Answer

The greatest difficulty with cost-benefit analysis of a public project is determining

Correct Answer
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Figure 11-1 -Refer to Figure 11-1. A gym membership at a gym that always has space in classes and on machines is an example of the type of good represented by Box

Correct Answer
verified

"Given that most people like to get 'free stuff,' it follows that goods that are available free of charge are produced and consumed in the proper amounts in a market economy." What is wrong with this statement?

Correct Answer
verified
In the absence of government interventio...
View Answer

Exam 11: Public Goods and Common Resources

On hot summer days, electricity-generating capacity is sometimes stretched to the limit. At these times, electric companies may ask people to voluntarily cut back on their use of electricity. On these days, electricity is

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following is not a typical solution to the "Tragedy of the Commons?"

Correct AnswerverifiedShow Answer

Four roommates share an off-campus house and equally share the cost of rent. Everyone says that she values a clean house, yet the house is usually dirty. To an economist, a clean house in this case represents

Correct AnswerverifiedShow Answer

Most lighthouses are operated by the government because

Correct AnswerverifiedShow Answer

Cost-benefit analysis is important to determine the role of government in our economy because

Correct AnswerverifiedShow Answer

Which two types of goods are excludable?

Correct AnswerverifiedPrivate go...View AnswerShow Answer

Because elephants roam freely in many countries in Africa, each individual African elephant poacher has

Correct AnswerverifiedShow Answer

Drivers have to pay a toll to drive on certain roads. In essence, a toll is a corrective tax on the externality of __________.

Correct AnswerverifiedShow Answer

Recall the four types of goods. Are national defense and a patented invention the same type of good? Briefly explain.

Correct AnswerverifiedNo. National defense...View AnswerShow Answer

The greatest difficulty with cost-benefit analysis of a public project is determining

Correct AnswerverifiedShow Answer

Figure 11-1 -Refer to Figure 11-1. A gym membership at a gym that always has space in classes and on machines is an example of the type of good represented by Box

Correct AnswerverifiedShow Answer

"Given that most people like to get 'free stuff,' it follows that goods that are available free of charge are produced and consumed in the proper amounts in a market economy." What is wrong with this statement?

Correct AnswerverifiedIn the absence of government interventio...View AnswerShow Answer

Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
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Private go...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
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No. National defense...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
In the absence of government interventio...
View Answer