Exam 16: Public Choices and Public Goods

-Tom and Jerry are the only members of society. The table above shows their marginal benefits from defense satellites, a public good. What is the marginal benefit to society from the third satellite?

Which of the following is a necessary characteristic of a public good? The good is

-In the above figure, the competitive unregulated equilibrium is producing and consuming ________ vaccinations per year at a price of ________.

-From the figure above showing the market for vaccinations, we can infer that there is an

Explain the difference between marginal social benefit and marginal external benefit.

An example of a natural monopoly is

Suppose that the marginal social benefit from another unit of a public good is less than the marginal social cost of producing it. Then

The benefit from an additional unit of a good or service that people other than the consumer of that good or service receives is the

-The above figure shows the marginal benefits and marginal costs of a college education. If no subsidies are paid, colleges charge tuition of

If the consumption of Good A by one person does not decrease the quantity of Good A available for another person's consumption, then the good is said to be

Which of the following is the BEST example of a private good?

The free-rider problem arises when consumption of a good is

"To find the economy's marginal social benefit curve for a public good, we sum the individual marginal benefit curves horizontally." True or false? Explain.

-The marginal cost of educating a student is $30,000, and this cost is independent of the number of students. The figure above shows the marginal private benefit that a student receives from education. If schools are competitive, how many students are enrolled?

The figure shows the supply curve (S) and the demand curve (D) for college education. The external benefit from college education is $6,000 per student per year and is constant. -In the figure above, if the government provides a subsidy to colleges of $6,000 per student per year, how many students will be accepted?

The external benefit of a good

If people can benefit from a good even if they do not pay for it, the good is nonrival.

-In the above figure, if no government intervention occurs, at the unregulated competitive market equilibrium, there is an

In an unregulated, competitive market, less than the efficient quantity of education is produced and consumed because

The decision not to acquire information because the cost of acquiring the information exceeds the expected benefit from the information is known as