Exam 11: Public Goods and Common Resources

You are the mayor of a town with 20,000 residents.The head of your economic development agency recently conducted a survey in which the 20,000 residents said that a small public library in the center of town would be worth $40 to each of them.The cost to build the library is $500,000.Which of the following is the most efficient option?

If the use of a common resource is not regulated,

Which of the following statements is not correct?

Who among the following is a free rider?

A good that is rival in consumption is one that someone can be prevented from using if she did not pay for it.

Simply asking people how much they value a highway is not a reliable way of measuring the benefits and costs because

Which parable describes the problem of wild animals that are hunted to the point of extinction?

At the local park there is a playground for children to use.While anyone is allowed to use the playground,it is often very busy,reducing the enjoyment of many of the children who use it.The playground is a

A cable television broadcast of a movie is

As with many public goods,determining the appropriate level of government support for the production of general knowledge is difficult because

You and your friends eat potato chips in your bedroom.For you and your friends,the potato chips are rival in consumption.

Table 11-4 There are four homes along Belmont Circle,which surrounds a small plot of land.The land currently has no trees,and the 4 homeowners -- Adams,Benitez,Chen,and Davis -- are considering the idea of contributing to a pool of money that will be used to plant up to 4 trees.The table represents their willingness to pay,that is,the maximum amount that each homeowner is willing to contribute toward each tree. -Refer to Table 11-4.Suppose the cost to plant each tree is $340 and the 4 homeowners have agreed to split all tree-planting costs equally.Which homeowner(s)would be in favor of planting at least 1 tree?

If one person's use of a good diminishes another person's enjoyment of it,the good is

The Occupational Safety and Health Administration (OSHA)has determined that 100 workers are exposed to a hazardous chemical used in the production of diet soft drinks.The cost of imposing a regulation that would ban the chemical is $10 million.OSHA has calculated that each person saved by this regulation has a value equal to $10 million.If the benefits are exactly equal to the costs,what probability is OSHA using to assess the likelihood of a fatality from exposure to this chemical?

Because the benefits of basic research are obvious and easy to measure,it is likely that the public sector pays for the right amount and the right kinds of basic research.

Tolls are not effective in altering people's incentives to drive during rush hour.

When a good is rival in consumption,

A vacation home in Malibu is

If a road is congested,then use of that road by an additional person would lead to a

Most goods in the economy are