Question 1

If property rights are assigned to a common resource,then the

Accepted Answer

A) government needs to set an ITQ to achieve efficiency. 
B) government needs to set a production quota to achieve efficiency. 
C) more than the efficient quantity is produced. 
D) marginal social benefit increases. 
E) marginal private cost becomes equal to the marginal social cost. 
A) government needs to set an ITQ to achieve efficiency. 
B) government needs to set a production quota to achieve efficiency. 
C) more than the efficient quantity is produced. 
D) marginal social benefit increases. 
E) marginal private cost becomes equal to the marginal social cost.

Question 2

The budget of a government department is likely to increase beyond the efficient quantity if

Accepted Answer

A) voters are well informed. 
B) there is rational voter ignorance combined with special interest lobbying. 
C) the political equilibrium can be described in terms of social interest theory. 
D) bureaucrats are rationally ignorant. 
E) there are negative externalities. 
A) voters are well informed. 
B) there is rational voter ignorance combined with special interest lobbying. 
C) the political equilibrium can be described in terms of social interest theory. 
D) bureaucrats are rationally ignorant. 
E) there are negative externalities.

Question 3

Which one of the following goods is excludable?

Accepted Answer

A) a city bus 
B) a bridge that does not charge a toll 
C) the atmosphere 
D) protection from the police force 
E) all of the above 
A) a city bus 
B) a bridge that does not charge a toll 
C) the atmosphere 
D) protection from the police force 
E) all of the above

Question 4

Use the figure below to answer the following questions.
   Figure 17.3.2
-Figure 17.3.2 shows the marginal private cost curve,marginal social cost curve,and marginal social benefit curve for raising goats on a common pasture.The efficient quantity is

Accepted Answer

A) 0 goats. 
B) 40 goats. 
C) 50 goats. 
D) 55 goats. 
E) 35 goats. 
A) 0 goats. 
B) 40 goats. 
C) 50 goats. 
D) 55 goats. 
E) 35 goats.

Question 5

An individual transferable quota is a production limit that

Accepted Answer

A) has a price equal to marginal cost. 
B) is assigned to every producer in the industry at a predetermined price. 
C) is assigned to an individual who must transfer the quota to anyone the government assigns. 
D) is assigned to an individual who is free to transfer the quota to someone else. 
E) has a price equal to marginal benefit. 
A) has a price equal to marginal cost. 
B) is assigned to every producer in the industry at a predetermined price. 
C) is assigned to an individual who must transfer the quota to anyone the government assigns. 
D) is assigned to an individual who is free to transfer the quota to someone else. 
E) has a price equal to marginal benefit.

Question 6

Your city council is contemplating upgrading its traffic control system and the council believes that the bigger the computer it installs,the better job it can do.Elected officials want to install the scale of the system that will win the most votes.The city bureaucrats want to maximize the budget.Suppose that you are an economist and your job is to calculate the scale of the system that uses resources efficiently.Public choice theory predicts that the quantity chosen will result in ________.As an informed voter,you can attempt to influence the choice of the correct system by encouraging other voters to ________.

Accepted Answer

A) overprovision that maximizes the budget of the bureaucrats;vote only for officials that will provide the smaller efficient quantity 
B) overprovision that maximizes the budget of the bureaucrats;increase their income elasticity of demand for the new traffic control system 
C) the efficient quantity;decrease their income elasticity of demand for the new traffic control system 
D) the efficient quantity;increase their income elasticity of demand for the new traffic control system 
E) overprovision that minimizes the income elasticity of demand of bureaucrats;decrease their elasticity of demand for the new traffic control system 
A) overprovision that maximizes the budget of the bureaucrats;vote only for officials that will provide the smaller efficient quantity 
B) overprovision that maximizes the budget of the bureaucrats;increase their income elasticity of demand for the new traffic control system 
C) the efficient quantity;decrease their income elasticity of demand for the new traffic control system 
D) the efficient quantity;increase their income elasticity of demand for the new traffic control system 
E) overprovision that minimizes the income elasticity of demand of bureaucrats;decrease their elasticity of demand for the new traffic control system

Question 7

Setting a production quota does not always achieve the efficient use of a common resource because ________.

Accepted Answer

A) marginal cost differs for each producer and it is in everyone's self-interest to cheat and produce more than the assigned quota 
B) the marginal private benefit from a production quota is zero 
C) marginal cost differs for each producer and the marginal social benefit from a production quota is zero 
D) a production quota does not totally eliminate the problem of free-ridership of a common resource 
E) none of the above 
A) marginal cost differs for each producer and it is in everyone's self-interest to cheat and produce more than the assigned quota 
B) the marginal private benefit from a production quota is zero 
C) marginal cost differs for each producer and the marginal social benefit from a production quota is zero 
D) a production quota does not totally eliminate the problem of free-ridership of a common resource 
E) none of the above

Question 8

The air in the atmosphere is

Accepted Answer

A) nonrival and nonexcludable. 
B) rival and nonexcludable. 
C) nonrival and excludable. 
D) rival and excludable. 
E) a private good. 
A) nonrival and nonexcludable. 
B) rival and nonexcludable. 
C) nonrival and excludable. 
D) rival and excludable. 
E) a private good.

Question 9

When a good is rival and excludable,it is a

Accepted Answer

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

If property rights are assigned to a common resource,then the

The budget of a government department is likely to increase beyond the efficient quantity if

Which one of the following goods is excludable?

Use the figure below to answer the following questions. Figure 17.3.2 -Figure 17.3.2 shows the marginal private cost curve,marginal social cost curve,and marginal social benefit curve for raising goats on a common pasture.The efficient quantity is

An individual transferable quota is a production limit that

Setting a production quota does not always achieve the efficient use of a common resource because ________.

The air in the atmosphere is

When a good is rival and excludable,it is a

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities,preferences,and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Markets for Factors of Production

Economic Inequality

Filters

Exam 17: Public Goods and Common Resources

If property rights are assigned to a common resource,then the

The budget of a government department is likely to increase beyond the efficient quantity if

Which one of the following goods is excludable?

Use the figure below to answer the following questions. Figure 17.3.2 -Figure 17.3.2 shows the marginal private cost curve,marginal social cost curve,and marginal social benefit curve for raising goats on a common pasture.The efficient quantity is

An individual transferable quota is a production limit that

Setting a production quota does not always achieve the efficient use of a common resource because ________.

The air in the atmosphere is

When a good is rival and excludable,it is a

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities,preferences,and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Markets for Factors of Production

Economic Inequality

Filters