Question 1

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 2

Depending on congestion,national parks can be either a common resource or a public good.

Accepted Answer

A) True 
 B)False

Question 3

Studies that compare the wages of more risky and less risky occupations estimate the value of a human life to be about

Accepted Answer

A)   $1 million.
B)   $5 million.
C)   $10 million.
D)   $20 million.E) A) and D)
F) A) and B)

Question 4

One possible solution to the problem of protecting a common resource is to convert that resource to a private good.

Accepted Answer

A) True 
 B)False

Question 5

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

Accepted Answer

A)   a slice of pizza
B)   cable TV service
C)   a sunset
D)   national defenseE) A) and B)
F) C) and D)

Question 6

Which of the following is not a way for the government to solve the problem of excessive use of common resources?

Accepted Answer

A)   regulation
B)   taxes
C)   turning the common resource into a public good
D)   turning the common resource into a private goodE) A) and D)
F) B) and C)

Question 7

Suppose that policymakers are doing cost-benefit analysis on a proposal to add traffic barriers to divide the flow of traffic in an effort to increase safety on a given highway.Which of the following statements is correct?

Accepted Answer

A)   The benefits are usually easier to measure than the costs.
B)   Because human life is priceless,any measure to increase traffic safety would generate benefits that outweigh the costs.
C)   Estimating the value of a human life is difficult but necessary in order to evaluate the proposal.
D)   Both a and b are correct.E) B) and D)
F) B) and C)

Question 8

Table 11-1
Consider the town of Tritown with only three residents,Ed,Jim,and Tony.The three residents are trying to determine how large,in acres,they should build the public park.The table below shows each resident's willingness to pay for each acre of the park.
 
-Refer to Table 11-1.Suppose the cost to build the park is $30 per acre and that the residents have agreed to split the cost of building the park equally.If the residents decide to build a park with size equal to the number of acres that maximizes total surplus from the park,how much total surplus will Ed receive?

Accepted Answer

A)   -$6
B)   -$2
C)   $2
D)   $10E) None of the above
F) A) and B)

Question 9

A study that compares the costs and benefits to society of providing a public good is called externality analysis.

Accepted Answer

A) True 
 B)False

Question 10

The Ogallala aquifer is a large underground pool of fresh water under several western states in the United States.Any farmer with land above the aquifer can at present pump water out of it.Which of the following statements about the aquifer is correct?

Accepted Answer

A)   The aquifer is a public good which must be publicly owned to be used efficiently.
B)   The aquifer is a private good which must be privately owned to be used efficiently.
C)   The aquifer is a common property resource which will be overused if no one owns it.
D)   The aquifer is a natural monopoly which should be left as it is.E) None of the above
F) B) and D)

Question 11

Which of the following is not a characteristic of a public good?

Accepted Answer

A)   It is nonexcludable.
B)   It is not diminished or depreciated as additional people consume the good.
C)   Its benefits cannot be withheld from anyone.
D)   Because it is a free good,there is no opportunity cost.E) B) and D)
F) A) and D)

Question 12

Some goods can be classified as either public goods or private goods depending on the circumstances.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following statements is not correct?

Accepted Answer

A)   Environmental degradation is an example of the Tragedy of the Commons.
B)   Cost-benefit analysis is an important tool that economists use to evaluate the benefits of providing a public good.
C)   Some goods,such as lighthouses,may be either private or public goods.
D)   The free-rider problem prevents governments from supplying public goods.E) None of the above
F) C) and D)

Question 14

The difference between specific knowledge and general knowledge is that

Accepted Answer

A)   the creation of general knowledge is usually more profitable for the creator.
B)   specific knowledge is excludable,while general knowledge is not excludable.
C)   general knowledge is excludable,while specific knowledge is not excludable.
D)   general knowledge is rival in consumption,while specific knowledge is not rival in consumption.E) B) and D)
F) B) and C)

Question 15

A streetlight is a

Accepted Answer

A)   private good.
B)   natural monopoly.
C)   common resource.
D)   public good.E) A) and B)
F) A) and C)

Question 16

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

Question 17

The U.S.government protects fish,a common resource,by

Accepted Answer

A)   subsidizing the fishing industry.
B)   heavily taxing competing industries.
C)   selling fishing licenses and regulating fish lengths.
D)   None of the above is correct.E) A) and B)
F) All of the above

Question 18

Because of the free-rider problem,

Accepted Answer

A)   private markets tend to undersupply public goods.
B)   the federal government spends too many resources on national defense and not enough resources on medical research.
C)   fireworks displays have become increasingly dangerous.
D)   poverty has increased.E) A) and B)
F) A) and C)

Question 19

In deciding whether a good is a public good,one must determine the

Accepted Answer

A)   incomes of those who benefit from the good.
B)   value of the external benefits that accrue to resource owners.
C)   excludability of the good.
D)   All of the above are correct.E) B) and C)
F) B) and D)

Question 20

Suppose that everyone prefers to live in a society without poverty.Further suppose that some private charities are successful in reducing poverty.People who do not contribute to the charities

Accepted Answer

A)   receive no external benefit from private antipoverty programs.
B)   decrease the reliance of individuals on antipoverty programs.
C)   can free ride on the generosity of others.
D)   are most likely to be in favor of government-sponsored programs.E) A) and B)
F) A) and C)

Exam 11: Public Goods and Common Resources

The Ogallala aquifer is a large underground pool of fresh water under several western states in the United States.Any farmer with land above the aquifer can at present pump water out of it.Which of the following statements about the aquifer is correct?

Correct Answer
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Which of the following is not a way for the government to solve the problem of excessive use of common resources?

Correct Answer
verified

A streetlight is a

Correct Answer
verified

In deciding whether a good is a public good,one must determine the

Correct Answer
verified

Some goods can be classified as either public goods or private goods depending on the circumstances.

Correct Answer
verified

Which of the following is not a characteristic of a public good?

Correct Answer
verified

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

Suppose that policymakers are doing cost-benefit analysis on a proposal to add traffic barriers to divide the flow of traffic in an effort to increase safety on a given highway.Which of the following statements is correct?

Correct Answer
verified

The U.S.government protects fish,a common resource,by

Correct Answer
verified

Studies that compare the wages of more risky and less risky occupations estimate the value of a human life to be about

Correct Answer
verified

A study that compares the costs and benefits to society of providing a public good is called externality analysis.

Correct Answer
verified

One possible solution to the problem of protecting a common resource is to convert that resource to a private good.

Correct Answer
verified

Because of the free-rider problem,

Correct Answer
verified

Suppose that everyone prefers to live in a society without poverty.Further suppose that some private charities are successful in reducing poverty.People who do not contribute to the charities

Correct Answer
verified

Depending on congestion,national parks can be either a common resource or a public good.

Correct Answer
verified

The difference between specific knowledge and general knowledge is that

Correct Answer
verified

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

Correct Answer
verified

Which of the following statements is not correct?

Correct Answer
verified

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

Correct Answer
verified

Exam 11: Public Goods and Common Resources

The Ogallala aquifer is a large underground pool of fresh water under several western states in the United States.Any farmer with land above the aquifer can at present pump water out of it.Which of the following statements about the aquifer is correct?

Correct AnswerverifiedShow Answer

Which of the following is not a way for the government to solve the problem of excessive use of common resources?

Correct AnswerverifiedShow Answer

A streetlight is a

Correct AnswerverifiedShow Answer

In deciding whether a good is a public good,one must determine the

Correct AnswerverifiedShow Answer

Some goods can be classified as either public goods or private goods depending on the circumstances.

Correct AnswerverifiedShow Answer

Which of the following is not a characteristic of a public good?

Correct AnswerverifiedShow 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

Suppose that policymakers are doing cost-benefit analysis on a proposal to add traffic barriers to divide the flow of traffic in an effort to increase safety on a given highway.Which of the following statements is correct?

Correct AnswerverifiedShow Answer

The U.S.government protects fish,a common resource,by

Correct AnswerverifiedShow Answer

Studies that compare the wages of more risky and less risky occupations estimate the value of a human life to be about

Correct AnswerverifiedShow Answer

A study that compares the costs and benefits to society of providing a public good is called externality analysis.

Correct AnswerverifiedShow Answer

One possible solution to the problem of protecting a common resource is to convert that resource to a private good.

Correct AnswerverifiedShow Answer

Because of the free-rider problem,

Correct AnswerverifiedShow Answer

Suppose that everyone prefers to live in a society without poverty.Further suppose that some private charities are successful in reducing poverty.People who do not contribute to the charities

Correct AnswerverifiedShow Answer

Depending on congestion,national parks can be either a common resource or a public good.

Correct AnswerverifiedShow Answer

The difference between specific knowledge and general knowledge is that

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Which of the following statements is not correct?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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