Question 1

Voluntary programs, direct controls, and emissions taxes are all equally effective ways of controlling pollution.

Accepted Answer

A) True 
 B)False

Question 2

Economists predicted that the price of a depletable natural resource would rise by about 15 percent.Actually the price fell 10 percent.What most likely happened?

Accepted Answer

A) A government subsidy was removed. 
B) Extraction costs increased. 
C) Price controls were suspended. 
D) An unexpected discovery of reserves was made. 
A) A government subsidy was removed. 
B) Extraction costs increased. 
C) Price controls were suspended. 
D) An unexpected discovery of reserves was made.

Question 3

Which of the following has also been called the command and control approach?

Accepted Answer

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

Question 4

How do rising prices slow resource depletion?

Accepted Answer

Three ways: reduce consumption (conserva

Question 5

Global warming of the past century, and especially in the past decade, is at least partly a consequence of human activities that have increased ____ in the atmosphere.

Accepted Answer

A) smog 
B) PCBs 
C) ozone 
D) "greenhouse gases" 
A) smog 
B) PCBs 
C) ozone 
D) "greenhouse gases"

Question 6

Economists use a resource's price as an indicator of its relative scarcity.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following could explain a fall over time in the price of the depletable resource aloe?

Accepted Answer

A) The productivity of aloe mines fell. 
B) New deposits of aloe were discovered. 
C) Demand for aloe increased over time. 
D) All of the above are correct. 
A) The productivity of aloe mines fell. 
B) New deposits of aloe were discovered. 
C) Demand for aloe increased over time. 
D) All of the above are correct.

Question 8

Many states charge a 10-cent deposit on every can of soda sold.A purchaser pays an extra 10 cents per can and will get his money back by returning the empty can to a store.This policy encourages recycling by

Accepted Answer

A) increasing the supply of recyclable materials. 
B) shifting in the demand curve for canned soda. 
C) raising the opportunity cost of discarding empty cans. 
D) taxing the production of canned soda. 
A) increasing the supply of recyclable materials. 
B) shifting in the demand curve for canned soda. 
C) raising the opportunity cost of discarding empty cans. 
D) taxing the production of canned soda.

Question 9

Following the sharp increases in oil prices in the United States caused by the OPEC oil embargo of 1973-1974, U.S.automakers started building smaller, more fuel-efficient cars.This development caused the

Accepted Answer

A) demand curve for oil to shift out. 
B) demand curve for oil to shift in. 
C) supply curve of oil to shift out. 
D) supply curve of oil to shift in. 
A) demand curve for oil to shift out. 
B) demand curve for oil to shift in. 
C) supply curve of oil to shift out. 
D) supply curve of oil to shift in.

Question 10

As a competitive economy uses its stocks of a depletable resource,

Accepted Answer

A) the resource price will fall by ever greater amounts each year. 
B) the resource price will rise by ever greater amounts each year. 
C) the use of the resource will increase at an increasing rate. 
D) resource use will drop to zero. 
A) the resource price will fall by ever greater amounts each year. 
B) the resource price will rise by ever greater amounts each year. 
C) the use of the resource will increase at an increasing rate. 
D) resource use will drop to zero.

Question 11

Environmental destruction is peculiar to centrally planned economies.

Accepted Answer

A) True 
 B)False

Question 12

When pollution emissions can be measured taxation will tend to be more effective than any other method of controlling pollution.

Accepted Answer

A) True 
 B)False

Question 13

Externalities can cause the market mechanism to

Accepted Answer

A) malfunction. 
B) improve. 
C) operate efficiently. 
D) move up toward the production possibility curve. 
A) malfunction. 
B) improve. 
C) operate efficiently. 
D) move up toward the production possibility curve.

Question 14

Recycling rates for aluminum, paper, and glass have been increasing in the United States.

Accepted Answer

A) True 
 B)False

Question 15

The production of smoke as a pollutant is a failure of the market system.

Accepted Answer

A) True 
 B)False

Question 16

Charging firms that emit pollutants is one way to deal with pollution.

Accepted Answer

A) True 
 B)False

Question 17

Environmental damage

Accepted Answer

A) cannot be reduced to zero. 
B) is inevitable where humans exist. 
C) tends to increase as long as benefits outweigh the costs to the damagers. 
D) All of the above are correct. 
A) cannot be reduced to zero. 
B) is inevitable where humans exist. 
C) tends to increase as long as benefits outweigh the costs to the damagers. 
D) All of the above are correct.

Question 18

If the price of a depleting resource does not rise as anticipated, it may be because:

Accepted Answer

A) ​new reserves of the resource were discovered. 
B) ​new methods of mining or refining were developed. 
C) ​price controls were passed by law. 
D) ​All of the above are correct. 
A) ​new reserves of the resource were discovered. 
B) ​new methods of mining or refining were developed. 
C) ​price controls were passed by law. 
D) ​All of the above are correct.

Question 19

The advantages of emissions permits over taxes is/are:

Accepted Answer

A) it reduces undertainty about the quantity of pollution that will be emitted. 
B) environmental authorities decide on an emissions ceiling in advance of issuing permits. 
C) pollutants can be limited to levels which do not affect health. 
D) All of the above are correct. 
A) it reduces undertainty about the quantity of pollution that will be emitted. 
B) environmental authorities decide on an emissions ceiling in advance of issuing permits. 
C) pollutants can be limited to levels which do not affect health. 
D) All of the above are correct.

Question 20

Regarding the causes of pollution, economists believe that:

Accepted Answer

A) the pricing system has failed. 
B) the public interest requires that pollution to be reduced below its market level. 
C) a firm pollutes the air and water because they are free. 
D) All of the above are correct. 
A) the pricing system has failed. 
B) the public interest requires that pollution to be reduced below its market level. 
C) a firm pollutes the air and water because they are free. 
D) All of the above are correct.

Exam 16: Externalities the Environment and Natural Resources

Voluntary programs, direct controls, and emissions taxes are all equally effective ways of controlling pollution.

Economists predicted that the price of a depletable natural resource would rise by about 15 percent.Actually the price fell 10 percent.What most likely happened?

Which of the following has also been called the command and control approach?

How do rising prices slow resource depletion?

Global warming of the past century, and especially in the past decade, is at least partly a consequence of human activities that have increased ____ in the atmosphere.

Economists use a resource's price as an indicator of its relative scarcity.

Which of the following could explain a fall over time in the price of the depletable resource aloe?

Many states charge a 10-cent deposit on every can of soda sold.A purchaser pays an extra 10 cents per can and will get his money back by returning the empty can to a store.This policy encourages recycling by

Following the sharp increases in oil prices in the United States caused by the OPEC oil embargo of 1973-1974, U.S.automakers started building smaller, more fuel-efficient cars.This development caused the

As a competitive economy uses its stocks of a depletable resource,

Environmental destruction is peculiar to centrally planned economies.

When pollution emissions can be measured taxation will tend to be more effective than any other method of controlling pollution.

Externalities can cause the market mechanism to

Recycling rates for aluminum, paper, and glass have been increasing in the United States.

The production of smoke as a pollutant is a failure of the market system.

Charging firms that emit pollutants is one way to deal with pollution.

Environmental damage

If the price of a depleting resource does not rise as anticipated, it may be because:

The advantages of emissions permits over taxes is/are:

Regarding the causes of pollution, economists believe that:

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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