Question 1

The ocean remains one of the largest unregulated resources for each of the following reasons except

Accepted Answer

A)   many countries have access to the ocean.
B)   it is difficult to get international cooperation among countries that hold different values.
C)   the oceans are so vast that enforcing any agreements would be difficult.
D)   All of the above are reasons the ocean remains one of the largest unregulated resources.E) A) and C)
F) A) and D)

Question 2

If one person's use of a good diminishes another person's enjoyment of it,the good is

Accepted Answer

A)   rival in consumption.
B)   excludable.
C)   normal.
D)   exhaustible.E) A) and B)
F) A) and C)

Question 3

Who among the following is a free rider?

Accepted Answer

A)   Mickey buys groceries from the store where he works.
B)   Donald rides to work with Betsey,but he pays Betsey for gasoline and other travel-related expenses.
C)   Fred drives 20,000 miles a year on public streets,but he pays no more in property taxes than Barney,who only drives 1,000 miles.
D)   Wilma watches many public television programs,but she has never sent in a contribution to the station.E) C) and D)
F) A) and B)

Question 4

Government agencies,such as the National Science Foundation,subsidize basic research because in the absence of a subsidy too little research would be conducted.

Accepted Answer

A) True 
 B)False

Question 5

Pollution is a

Accepted Answer

A)   problem that is entirely unrelated to the parable called the Tragedy of the Commons.
B)   problem that cannot be remedied with regulations or corrective taxes.
C)   negative externality that can be viewed as a public-goods problem.
D)   negative externality that can be viewed as a common-resource problem.E) B) and C)
F) A) and D)

Question 6

A variable toll on a road in Washington reached a high during the evening rush hour of $5.75.This toll bought the drivers who paid it a 27 minute time savings.Which of the following is correct?

Accepted Answer

A)   For some consumers,the toll was less than the opportunity cost of the time they would have spent in traffic.
B)   For some consumers,the toll was more than the opportunity cost of the time they would have spent in traffic.
C)   No consumers would find this toll worth the time saved in traffic.
D)   Both a and b are correct.E) A) and D)
F) All of the above

Question 7

An example of the "Tragedy of the Commons" is litter in the picnic area of a local park.

Accepted Answer

A) True 
 B)False

Question 8

A good that is excludable is one that someone can be prevented from using if she did not pay for it.

Accepted Answer

A) True 
 B)False

Question 9

If everyone benefits from helping the poor,

Accepted Answer

A)   government intervention cannot improve social well-being.
B)   eliminating taxes aimed at redistributing income will make rich people better off.
C)   taxing the wealthy to raise living standards of the poor can potentially make everyone better off.
D)   private markets can adequately provide charity programs to help the poor,despite free-rider problems.E) A) and C)
F) A) and D)

Question 10

Which of the following would be considered a private good?

Accepted Answer

A)   national defense
B)   a public beach
C)   local cable television service
D)   a bottle of natural mineral waterE) B) and D)
F) B) and C)

Question 11

It would always be a mistake to view

Accepted Answer

A)   many species of animals as common resources.
B)   a road as a public good.
C)   national defense as a common resource.
D)   a fireworks display as a public good.E) A) and B)
F) All of the above

Question 12

The Tragedy of the Commons describes

Accepted Answer

A)   government regulation that is necessary to combat externalities.
B)   overuse of a common resource relative to its economically efficient use.
C)   the nonrivalry feature of a common resource.
D)   an effective cost-benefit analysis.E) None of the above
F) A) and C)

Question 13

Table 11-5
A small strip mall contains four retail stores,and crime has recently been on the increase in the neighborhood of the strip mall.The owners of the four stores - Stores A,B,C,and D - are considering contributing to a pool of money that will be used to hire up to 4 security guards.The table represents their willingness to pay,that is,the maximum amount that each store owner is willing to contribute,per day,to hire each security guard.
 
-Refer to Table 11-5.Suppose the cost to hire each individual guard is $110 per day and the 4 store owners have agreed to split the costs of hiring guards equally.Which of the following statements is correct?

Accepted Answer

A)   The owner of Store A would prefer to hire 2 guards.
B)   The owner of Store C would prefer to hire 1 guard.
C)   The owners of Stores B and D would prefer to hire 3 guards.
D)   All of the above are correct.E) B) and C)
F) A) and B)

Question 14

When the value of a human life is calculated according to the economic contribution a person makes to society (as reflected in her income-earning potential) ,the troubling implication is that

Accepted Answer

A)   it is possible for a retired or disabled person to have no value to society.
B)   economists are more valuable than entrepreneurs.
C)   retired people who volunteer in their communities are more valuable than physicians.
D)   all workers have equal value.E) B) and D)
F) A) and D)

Question 15

In determining whether and how much of a public good to provide,cost-benefits analysts use the same type of price signals for public goods as are readily available for private goods.

Accepted Answer

A) True 
 B)False

Question 16

If we can conclude that human life has a finite value,cost-benefit analysis can lead to solutions in which human life is worth less than the cost of a potential project.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following goods is both excludable and rival in consumption?

Accepted Answer

A)   a wristwatch
B)   fire protection in a small town
C)   fish in the ocean
D)   efforts to fight povertyE) A) and B)
F) B) and D)

Question 18

A town engineer comes to the city council with a proposal to install a traffic light at a certain intersection that currently has a stop sign.The benefit of the traffic light is increased safety because the light will reduce the incidence of fatal traffic accidents by 50 percent per year.Which of the following statements is correct?

Accepted Answer

A)   The city council should vote to install the traffic light because the benefits will outweigh the costs.
B)   The city council should carefully evaluate the benefits of reduced fatalities against only the explicit costs of the light.
C)   The city council should carefully evaluate the benefits of reduced fatalities against the costs of the light and of the extra time that drivers will spend waiting for a green light.
D)   The costs will invariably outweigh the benefits.E) None of the above
F) All of the above

Question 19

A congested side street in your neighborhood is

Accepted Answer

A)   excludable and rival in consumption.
B)   excludable and not rival in consumption.
C)   not excludable and rival in consumption.
D)   not excludable and not rival in consumption.E) A) and B)
F) All of the above

Question 20

Economists argue that we can calculate the value of a human life by observing voluntary risks that people take every day.

Accepted Answer

A) True 
 B)False

Exam 11: Public Goods and Common Resources

In determining whether and how much of a public good to provide,cost-benefits analysts use the same type of price signals for public goods as are readily available for private goods.

Correct Answer
verified

If one person's use of a good diminishes another person's enjoyment of it,the good is

Correct Answer
verified

If we can conclude that human life has a finite value,cost-benefit analysis can lead to solutions in which human life is worth less than the cost of a potential project.

Correct Answer
verified

The Tragedy of the Commons describes

Correct Answer
verified

Correct Answer
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When the value of a human life is calculated according to the economic contribution a person makes to society (as reflected in her income-earning potential) ,the troubling implication is that

Correct Answer
verified

Which of the following would be considered a private good?

Correct Answer
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The ocean remains one of the largest unregulated resources for each of the following reasons except

Correct Answer
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It would always be a mistake to view

Correct Answer
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Which of the following goods is both excludable and rival in consumption?

Correct Answer
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If everyone benefits from helping the poor,

Correct Answer
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Correct Answer
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A congested side street in your neighborhood is

Correct Answer
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A variable toll on a road in Washington reached a high during the evening rush hour of $5.75.This toll bought the drivers who paid it a 27 minute time savings.Which of the following is correct?

Correct Answer
verified

Who among the following is a free rider?

Correct Answer
verified

A good that is excludable is one that someone can be prevented from using if she did not pay for it.

Correct Answer
verified

Government agencies,such as the National Science Foundation,subsidize basic research because in the absence of a subsidy too little research would be conducted.

Correct Answer
verified

Pollution is a

Correct Answer
verified

Economists argue that we can calculate the value of a human life by observing voluntary risks that people take every day.

Correct Answer
verified

An example of the "Tragedy of the Commons" is litter in the picnic area of a local park.

Correct Answer
verified

Exam 11: Public Goods and Common Resources

In determining whether and how much of a public good to provide,cost-benefits analysts use the same type of price signals for public goods as are readily available for private goods.

Correct AnswerverifiedShow Answer

If one person's use of a good diminishes another person's enjoyment of it,the good is

Correct AnswerverifiedShow Answer

If we can conclude that human life has a finite value,cost-benefit analysis can lead to solutions in which human life is worth less than the cost of a potential project.

Correct AnswerverifiedShow Answer

The Tragedy of the Commons describes

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

When the value of a human life is calculated according to the economic contribution a person makes to society (as reflected in her income-earning potential) ,the troubling implication is that

Correct AnswerverifiedShow Answer

Which of the following would be considered a private good?

Correct AnswerverifiedShow Answer

The ocean remains one of the largest unregulated resources for each of the following reasons except

Correct AnswerverifiedShow Answer

It would always be a mistake to view

Correct AnswerverifiedShow Answer

Which of the following goods is both excludable and rival in consumption?

Correct AnswerverifiedShow Answer

If everyone benefits from helping the poor,

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A congested side street in your neighborhood is

Correct AnswerverifiedShow Answer

A variable toll on a road in Washington reached a high during the evening rush hour of $5.75.This toll bought the drivers who paid it a 27 minute time savings.Which of the following is correct?

Correct AnswerverifiedShow Answer

Who among the following is a free rider?

Correct AnswerverifiedShow Answer

A good that is excludable is one that someone can be prevented from using if she did not pay for it.

Correct AnswerverifiedShow Answer

Government agencies,such as the National Science Foundation,subsidize basic research because in the absence of a subsidy too little research would be conducted.

Correct AnswerverifiedShow Answer

Pollution is a

Correct AnswerverifiedShow Answer

Economists argue that we can calculate the value of a human life by observing voluntary risks that people take every day.

Correct AnswerverifiedShow Answer

An example of the "Tragedy of the Commons" is litter in the picnic area of a local park.

Correct AnswerverifiedShow Answer

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