Question 1

Suppose a human life is worth $10 million.Installing a better lighting system in the city park would reduce the risk of someone being murdered there from 2.3 to 1.8 percent over the life of the system.The city should install the new lighting system if its cost does not exceed

Accepted Answer

A)   $50,000.
B)   $180,000.
C)   $230,000.
D)   $500,000.E) None of the above
F) A) and D)

Question 2

Which of the following is not a common resource?

Accepted Answer

A)   congested roads
B)   clean water
C)   wild gorillas
D)   a fireworks displayE) C) and D)
F) None of the above

Question 3

Goods that are not excludable are usually

Accepted Answer

A)   higher priced than excludable goods.
B)   higher priced than rival goods.
C)   in short supply.
D)   free of charge.E) B) and C)
F) A) and D)

Question 4

Figure 11-1
 
-Refer to Figure 11-1.The box labeled B represents what type of good?

Accepted Answer

Box B repr...

Question 5

Goods that are rival in consumption but not excludable would be considered

Accepted Answer

A)   club goods.
B)   common resources.
C)   public goods.
D)   private goods.E) C) and D)
F) B) and C)

Question 6

Table 11-3
This table describes the defense demands for three equal sized groups of people in Nirvanaville.The second,third,and fourth column shows the quantity that a group will demand for a given price (the first column) .
 th unit of national defense in Nirvananville? A)  $8 B)  $14 C)  $18 D)  $24" class="answers-bank-image d-inline" rel="preload" >
-Refer to Table 11-3.What is the value of the 13th unit of national defense in Nirvananville?

Accepted Answer

A)   $8
B)   $14
C)   $18
D)   $24E) A) and B)
F) C) and D)

Question 7

The commercial value of ivory is a threat to the elephant,but the commercial value of beef is a guardian of the cow.This is because

Accepted Answer

A)   the cow is raised in developed countries,while the elephant lives primarily in less-developed countries.
B)   cows are private goods,while elephants tend to roam freely without owners.
C)   cows and elephants are public goods,but ivory is nonrival.
D)   ivory is nonrival and nonexclusive,but beef is rival and exclusive.E) A) and B)
F) A) and C)

Question 8

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) A) and B)
F) All of the above

Question 9

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 10

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 guard is $120 per day and the 4 store owners have agreed to split the costs of hiring guards equally.How many guards would the owner of Store A prefer to hire?

Accepted Answer

A)   0
B)   1
C)   2
D)   3E) A) and B)
F) A) and C)

Question 11

What do American drivers on congested roads and Soviet shoppers waiting in line to purchase clothing have in common?

Accepted Answer

A)   Both the American drivers and the Soviet shoppers are consuming products at prices that do not represent the full costs of the products.
B)   Both the American drivers and the Soviet shoppers can purchase as much as they want at the market price.
C)   Both the American drivers and the Soviet shoppers could avoid waiting if the prices were lowered.
D)   American drivers and Soviet shoppers have nothing in common.E) A) and B)
F) A) and C)

Question 12

Which of the following is an example of government intervention to solve a Tragedy of the Commons problem?

Accepted Answer

A)   subsidizing basic research
B)   building lighthouses
C)   toll charges on congested roads
D)   cost-benefit analysisE) B) and D)
F) A) and C)

Question 13

Figure 11-1
 
-Refer to Figure 11-1.A ham sandwich is an example of the type of good represented by Box

Accepted Answer

A)   A.
B)   B.
C)   C.
D)   D.E) All of the above
F) A) and B)

Question 14

Which of the following is most likely to face extinction?

Accepted Answer

A)   dogs living as pets in households
B)   dairy cows living on farms and producing milk
C)   bald eagles living in zoos
D)   tigers living in the wildE) A) and D)
F) A) and C)

Question 15

Common resources and public goods have in common that they are not excludable and they are not rival in consumption.

Accepted Answer

A) True 
 B)False

Question 16

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) C) and D)
F) A) and B)

Question 17

In some cases the government can make everyone better off by raising taxes to pay for certain goods that the market fails to provide.

Accepted Answer

A) True 
 B)False

Question 18

Both public goods and common resources are

Accepted Answer

A)   rival in consumption.
B)   nonrival in consumption.
C)   excludable.
D)   nonexcludable.E) None of the above
F) B) and C)

Question 19

Concerts in arenas are not excludable because it is virtually impossible to prevent someone from seeing the show.

Accepted Answer

A) True 
 B)False

Question 20

When a free-rider problem exists,

Accepted Answer

A)   the market will devote too few resources to the production of the good.
B)   the cost of the good will always be more than the benefit of the good.
C)   the good will not be produced.
D)   entrepreneurs will eventually find a way to make free-riders pay their share.E) None of the above
F) A) and B)

Exam 11: Public Goods and Common Resources

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

Correct Answer
verified

Suppose a human life is worth $10 million.Installing a better lighting system in the city park would reduce the risk of someone being murdered there from 2.3 to 1.8 percent over the life of the system.The city should install the new lighting system if its cost does not exceed

Correct Answer
verified

The commercial value of ivory is a threat to the elephant,but the commercial value of beef is a guardian of the cow.This is because

Correct Answer
verified

Which of the following is not a common resource?

Correct Answer
verified

Concerts in arenas are not excludable because it is virtually impossible to prevent someone from seeing the show.

Correct Answer
verified

Which of the following is an example of government intervention to solve a Tragedy of the Commons problem?

Correct Answer
verified

Correct Answer
verified

What do American drivers on congested roads and Soviet shoppers waiting in line to purchase clothing have in common?

Correct Answer
verified

Which of the following is most likely to face extinction?

Correct Answer
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Correct Answer
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Figure 11-1 -Refer to Figure 11-1.The box labeled B represents what type of good?

Correct Answer
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Box B repr...
View Answer

In some cases the government can make everyone better off by raising taxes to pay for certain goods that the market fails to provide.

Correct Answer
verified

Both public goods and common resources are

Correct Answer
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Pollution is a

Correct Answer
verified

Goods that are rival in consumption but not excludable would be considered

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

Goods that are not excludable are usually

Correct Answer
verified

When a free-rider problem exists,

Correct Answer
verified

Figure 11-1 -Refer to Figure 11-1.A ham sandwich is an example of the type of good represented by Box

Correct Answer
verified

Common resources and public goods have in common that they are not excludable and they are not rival in consumption.

Correct Answer
verified

Exam 11: Public Goods and Common Resources

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

Correct AnswerverifiedShow Answer

Suppose a human life is worth $10 million.Installing a better lighting system in the city park would reduce the risk of someone being murdered there from 2.3 to 1.8 percent over the life of the system.The city should install the new lighting system if its cost does not exceed

Correct AnswerverifiedShow Answer

The commercial value of ivory is a threat to the elephant,but the commercial value of beef is a guardian of the cow.This is because

Correct AnswerverifiedShow Answer

Which of the following is not a common resource?

Correct AnswerverifiedShow Answer

Concerts in arenas are not excludable because it is virtually impossible to prevent someone from seeing the show.

Correct AnswerverifiedShow Answer

Which of the following is an example of government intervention to solve a Tragedy of the Commons problem?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

What do American drivers on congested roads and Soviet shoppers waiting in line to purchase clothing have in common?

Correct AnswerverifiedShow Answer

Which of the following is most likely to face extinction?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Figure 11-1 -Refer to Figure 11-1.The box labeled B represents what type of good?

Correct AnswerverifiedBox B repr...View AnswerShow Answer

In some cases the government can make everyone better off by raising taxes to pay for certain goods that the market fails to provide.

Correct AnswerverifiedShow Answer

Both public goods and common resources are

Correct AnswerverifiedShow Answer

Pollution is a

Correct AnswerverifiedShow Answer

Goods that are rival in consumption but not excludable would be considered

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

Goods that are not excludable are usually

Correct AnswerverifiedShow Answer

When a free-rider problem exists,

Correct AnswerverifiedShow Answer

Figure 11-1 -Refer to Figure 11-1.A ham sandwich is an example of the type of good represented by Box

Correct AnswerverifiedShow Answer

Common resources and public goods have in common that they are not excludable and they are not rival in consumption.

Correct AnswerverifiedShow Answer

Correct Answer
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Box B repr...
View Answer

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