Question 1

Individuals play ____ in causing pollution.

Accepted Answer

A) almost no role 
B) a large but decreasing role 
C) a major role 
D) a reconstructive role 
A) almost no role 
B) a large but decreasing role 
C) a major role 
D) a reconstructive role

Question 2

Requiring all firms to reduce emissions by the same percentage is

Accepted Answer

A) impossible. 
B) inefficient. 
C) inequitable. 
D) unenforceable under the law. 
A) impossible. 
B) inefficient. 
C) inequitable. 
D) unenforceable under the law.

Question 3

Under perfect competition the price of a depletable resource whose cost of extraction is not changing must rise at

Accepted Answer

A) the same rate as the increase in GDP. 
B) the same rate as the increase in consumer prices. 
C) the same rate as the rate of interest. 
D) a rate higher than the increase in the rate of interest. 
A) the same rate as the increase in GDP. 
B) the same rate as the increase in consumer prices. 
C) the same rate as the rate of interest. 
D) a rate higher than the increase in the rate of interest.

Question 4

The major problem with direct controls as an environmental protection measure has been

Accepted Answer

A) inept administrators. 
B) corrupt judges. 
C) illegal dumping. 
D) legislation with no teeth. 
A) inept administrators. 
B) corrupt judges. 
C) illegal dumping. 
D) legislation with no teeth.

Question 5

Which of the following would not lead to more conservation?

Accepted Answer

A) higher prices for a resource 
B) increased interest rates on bonds 
C) public awareness of increasing scarcity 
D) higher taxes on goods produced using the resource 
A) higher prices for a resource 
B) increased interest rates on bonds 
C) public awareness of increasing scarcity 
D) higher taxes on goods produced using the resource

Question 6

Taxes on polluting firms have

Accepted Answer

A) been tried, but not successfully. 
B) been successful in Germany in reducing water pollution. 
C) resulted in bankruptcy of the affected firms. 
D) never been tried to see if they work. 
A) been tried, but not successfully. 
B) been successful in Germany in reducing water pollution. 
C) resulted in bankruptcy of the affected firms. 
D) never been tried to see if they work.

Question 7

As a resource becomes more scarce, we expect its price to

Accepted Answer

A) rise. 
B) fall. 
C) remain constant. 
D) fluctuate wildly. 
A) rise. 
B) fall. 
C) remain constant. 
D) fluctuate wildly.

Question 8

Detrimental externalities like pollution are a shortcoming of the market mechanism.Do they occur in free market economies alone? Explain with examples.

Accepted Answer

Even though the detrimental externalitie

Question 9

Economic theory would lead us to suspect that deep sea oil reserves would be accessed before those located in the Middle East or on the U.S.mainland.

Accepted Answer

A) True 
 B)False

Question 10

Pollution is a relatively new phenomenon.

Accepted Answer

A) True 
 B)False

Question 11

The cause of the "greenhouse effect" is the

Accepted Answer

A) increasing use of glass in construction. 
B) growth of desertification. 
C) burning of "fossil fuels." 
D) decline in carbon dioxide in the atmosphere. 
A) increasing use of glass in construction. 
B) growth of desertification. 
C) burning of "fossil fuels." 
D) decline in carbon dioxide in the atmosphere.

Question 12

A failure of the pricing system has led to pollution.

Accepted Answer

A) True 
 B)False

Question 13

____ has(have) traditionally been the chief instrument of environmental policy in the United States.

Accepted Answer

A) Taxes on pollution 
B) Voluntary compliance 
C) Tradable emissions permits 
D) Direct controls 
A) Taxes on pollution 
B) Voluntary compliance 
C) Tradable emissions permits 
D) Direct controls

Question 14

Many economists argue that the most efficient way to control pollution is to

Accepted Answer

A) ban all activities that create pollution. 
B) enforce legal standards on air and water quality. 
C) promote environmental awareness among citizens. 
D) impose taxes on emissions. 
A) ban all activities that create pollution. 
B) enforce legal standards on air and water quality. 
C) promote environmental awareness among citizens. 
D) impose taxes on emissions.

Question 15

How the price of a depletable resource changes over time depends on

Accepted Answer

A) how the technology of resource extraction changes. 
B) the interest rate. 
C) how the technologies of production change in firms that use the resource. 
D) All of the above are correct. 
A) how the technology of resource extraction changes. 
B) the interest rate. 
C) how the technologies of production change in firms that use the resource. 
D) All of the above are correct.

Question 16

Economic theory posits that a resource which is finite and being depleted will rise in price continuously, and demand will be reduced.In fact, a recent study, graphing the price behavior of lead, zinc and copper found that until about 2007,

Accepted Answer

A) ​prices rose steadily, as predicted. 
B) ​prices dropped precipitously. 
C) ​prices remained remarkably stable. 
D) ​prices were up and down with no discernible pattern. 
A) ​prices rose steadily, as predicted. 
B) ​prices dropped precipitously. 
C) ​prices remained remarkably stable. 
D) ​prices were up and down with no discernible pattern.

Question 17

If one tracks the prices of critical metals, one sees that

Accepted Answer

A) they have risen more slowly than the general rate of inflation. 
B) they have risen about as rapidly as the general rate of inflation. 
C) the prices indicate increasing scarcity of the metals. 
D) the prices have fluctuated too wildly to conclude anything. 
A) they have risen more slowly than the general rate of inflation. 
B) they have risen about as rapidly as the general rate of inflation. 
C) the prices indicate increasing scarcity of the metals. 
D) the prices have fluctuated too wildly to conclude anything.

Question 18

Which of the following statements is false?

Accepted Answer

A) In a competitive market, the price mechanism encourages conservation of a depletable resource. 
B) As the price of a depletable resource rises, its known reserves often increase. 
C) Prices of depletable resources have risen in the twentieth century primarily because resource producers have exercised monopoly or oligopoly power. 
D) Shortages of depletable resources occur primarily when governments or others interfere with the price mechanism. 
A) In a competitive market, the price mechanism encourages conservation of a depletable resource. 
B) As the price of a depletable resource rises, its known reserves often increase. 
C) Prices of depletable resources have risen in the twentieth century primarily because resource producers have exercised monopoly or oligopoly power. 
D) Shortages of depletable resources occur primarily when governments or others interfere with the price mechanism.

Question 19

Cleaning an environment may lead to

Accepted Answer

A) less production. 
B) higher prices. 
C) lower incomes. 
D) all of the above. 
A) less production. 
B) higher prices. 
C) lower incomes. 
D) all of the above.

Question 20

The use of tax penalties to control pollution represents a

Accepted Answer

A) price-based market approach to the pollution problem. 
B) non-market approach to the pollution problem. 
C) major source of current federal revenues. 
D) pollution-rights solution to the pollution problem. 
A) price-based market approach to the pollution problem. 
B) non-market approach to the pollution problem. 
C) major source of current federal revenues. 
D) pollution-rights solution to the pollution problem.

Exam 16: Externalities the Environment and Natural Resources

Individuals play ____ in causing pollution.

Requiring all firms to reduce emissions by the same percentage is

Under perfect competition the price of a depletable resource whose cost of extraction is not changing must rise at

The major problem with direct controls as an environmental protection measure has been

Which of the following would not lead to more conservation?

Taxes on polluting firms have

As a resource becomes more scarce, we expect its price to

Detrimental externalities like pollution are a shortcoming of the market mechanism.Do they occur in free market economies alone? Explain with examples.

Economic theory would lead us to suspect that deep sea oil reserves would be accessed before those located in the Middle East or on the U.S.mainland.

Pollution is a relatively new phenomenon.

The cause of the "greenhouse effect" is the

A failure of the pricing system has led to pollution.

____ has(have) traditionally been the chief instrument of environmental policy in the United States.

Many economists argue that the most efficient way to control pollution is to

How the price of a depletable resource changes over time depends on

Economic theory posits that a resource which is finite and being depleted will rise in price continuously, and demand will be reduced.In fact, a recent study, graphing the price behavior of lead, zinc and copper found that until about 2007,

If one tracks the prices of critical metals, one sees that

Which of the following statements is false?

Cleaning an environment may lead to

The use of tax penalties to control pollution represents a

What Is Economics

The Economy Myth and Reality

The Fundamental Economic Problem Scarcity and Choice

Supply and Demand an Initial Look

Consumer Choice Individual and Market Demand

Demand and Elasticity

Production Inputs and Cost Building Blocks for Supply Analysis

Output Price and Profit the Importance of Marginal Analysis

Securities Business Finance and the Economy the Tail That Wags the Dog

The Firm and the Industry Under Perfect Competition

Monopoly

Between Competition and Monopoly

Limiting Market Power Regulation and Antitrust

The Case for Free Markets the Price System

The Shortcomings of Free Markets

Taxation and Resource Allocation

Pricing the Factors of Production

Labor and Entrepreneurship the Human Inputs

Poverty Inequality and Discrimination

Is Us Economic Leadership Threatened

International Trade and Comparative Advantage

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