Question 1

Knowledge is an example of a

Accepted Answer

A) public good. 
B) private good. 
C) common resource. 
D) club good. 
A) public good. 
B) private good. 
C) common resource. 
D) club good.

Question 2

For most goods in an economy, the primary signal that guides the decisions of buyers and sellers is

Accepted Answer

A) advertising. 
B) quality. 
C) reputation. 
D) price. 
A) advertising. 
B) quality. 
C) reputation. 
D) price.

Question 3

Because public goods are

Accepted Answer

A) excludable, people have an incentive to be free riders. 
B) excludable, people do not have an incentive to be free riders. 
C) not excludable, people have an incentive to be free riders. 
D) not excludable, people do not have an incentive to be free riders. 
A) excludable, people have an incentive to be free riders. 
B) excludable, people do not have an incentive to be free riders. 
C) not excludable, people have an incentive to be free riders. 
D) not excludable, people do not have an incentive to be free riders.

Question 4

Goods that are not excludable include both

Accepted Answer

A) private goods and public goods. 
B) club goods and common resources. 
C) common resources and public goods. 
D) private goods and club goods. 
A) private goods and public goods. 
B) club goods and common resources. 
C) common resources and public goods. 
D) private goods and club goods.

Question 5

When goods do not have a price, which of the following primarily ensures that the good is produced?

Accepted Answer

A) buyers 
B) sellers 
C) government 
D) the market 
A) buyers 
B) sellers 
C) government 
D) the market

Question 6

Figure 11-1  
-Refer to Figure 11-1. The box labeled D represents what type of good?

Accepted Answer

Box D repr

Question 7

Table 11-5
A small island off the coast of Cape Cod contains two restaurants and two retail stores. Tourists need to take a ferry boat to reach the island, but with a recent slowdown in the economy, tourists are less willing to pay for the boat ride to visit the island. The owners of the restaurants and stores on the island - Restaurants 1 and 2, and Stores A and B - think that if tourists could ride the ferry for free, they would be happy to visit the island, eat and shop. The business owners are considering contributing to a pool of money that will be used to pay for roundtrip ferry service each day. The table represents their willingness to pay, that is, the maximum amount that each business owner is willing to contribute, per day, to pay for each ferry trip.  
-Refer to Table 11-5. Suppose the cost to run the ferry for each roundtrip is $750 per day and the 4 business owners have agreed to split the costs of the ferry trips equally. How many ferry trips would the owner of Restaurant 1 prefer to have?

Accepted Answer

A) 0 
B) 1 
C) 2 
D) 3 
A) 0 
B) 1 
C) 2 
D) 3

Question 8

Stewart is a lobsterman. His traps are

Accepted Answer

A) private goods and the lobster he catches are common resources. 
B) private goods and the lobster he catches are public goods. 
C) rival in consumption and the lobster he catches are not rival in consumption. 
D) not rival in consumption and the lobster he catches are not rival in consumption. 
A) private goods and the lobster he catches are common resources. 
B) private goods and the lobster he catches are public goods. 
C) rival in consumption and the lobster he catches are not rival in consumption. 
D) not rival in consumption and the lobster he catches are not rival in consumption.

Question 9

Under which of the following scenarios would a park be considered a club good?

Accepted Answer

A) Visitors to the park must pay an admittance fee, but there are always plenty of empty picnic tables. 
B) Visitors to the park must pay an admittance fee and frequently all of the picnic tables are in use. 
C) Visitors can enter the park free of charge and there are always plenty of empty picnic tables. 
D) Visitors can enter the park free of charge, but frequently all of the picnic tables are in use. 
A) Visitors to the park must pay an admittance fee, but there are always plenty of empty picnic tables. 
B) Visitors to the park must pay an admittance fee and frequently all of the picnic tables are in use. 
C) Visitors can enter the park free of charge and there are always plenty of empty picnic tables. 
D) Visitors can enter the park free of charge, but frequently all of the picnic tables are in use.

Question 10

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?

Accepted Answer

A) 0.001 
B) 0.01 
C) 0.1 
D) 1.0 
A) 0.001 
B) 0.01 
C) 0.1 
D) 1.0

Question 11

The U.S. patent system

Accepted Answer

A) makes general knowledge excludable. 
B) makes specific, technical knowledge excludable. 
C) creates a disincentive to invent. 
D) Both a and b are correct. 
A) makes general knowledge excludable. 
B) makes specific, technical knowledge excludable. 
C) creates a disincentive to invent. 
D) Both a and b are correct.

Question 12

In almost all cases of common resources, the same problem arises as in the Tragedy of the __________.

Accepted Answer

The answer of In almost all cases of common resources,...

Question 13

The free-rider problem

Accepted Answer

A) forces the supply of a public good to exceed its demand. 
B) results in common resources becoming club goods. 
C) explains why many local governments supply public goods. 
D) results in public goods becoming private goods. 
A) forces the supply of a public good to exceed its demand. 
B) results in common resources becoming club goods. 
C) explains why many local governments supply public goods. 
D) results in public goods becoming private goods.

Question 14

Why does the commercial value of ivory threaten the elephant, while the commercial value of beef protects the cow?

Accepted Answer

Elephants are a common resource, whereas

Question 15

Pollution is a negative externality, but it is not appropriate to view the problem of pollution as a common-resource problem.

Accepted Answer

A) True 
 B)False

Question 16

Figure 11-1  
-Refer to Figure 11-1. The box labeled C represents what type of good?

Accepted Answer

Box C repr

Question 17

Figure 11-1  
-Refer to Figure 11-1. A gym membership at a gym that always has space in classes and on machines is an example of the type of good represented by Box

Accepted Answer

A) A. 
B) B. 
C) C. 
D) D. 
A) A. 
B) B. 
C) C. 
D) D.

Question 18

Which city currently charges drivers a "congestion toll" to drive into the heart of the city's financial, legal, and entertainment district?

Accepted Answer

A) Washington, D.C. 
B) Sydney 
C) Tokyo 
D) London 
A) Washington, D.C. 
B) Sydney 
C) Tokyo 
D) London

Question 19

"Given that most people like to get 'free stuff,' it follows that goods that are available free of charge are produced and consumed in the proper amounts in a market economy." What is wrong with this statement?

Accepted Answer

In the absence of government interventio

Question 20

What is the main difficulty facing cost-benefit analysts when they attempt to evaluate the worthiness of proposed public projects?

Accepted Answer

The main difficulty is that co

Knowledge is an example of a

For most goods in an economy, the primary signal that guides the decisions of buyers and sellers is

Because public goods are

Goods that are not excludable include both

When goods do not have a price, which of the following primarily ensures that the good is produced?

Figure 11-1 -Refer to Figure 11-1. The box labeled D represents what type of good?

Stewart is a lobsterman. His traps are

Under which of the following scenarios would a park be considered a club good?

The U.S. patent system

In almost all cases of common resources, the same problem arises as in the Tragedy of the __________.

The free-rider problem

Why does the commercial value of ivory threaten the elephant, while the commercial value of beef protects the cow?

Pollution is a negative externality, but it is not appropriate to view the problem of pollution as a common-resource problem.

Figure 11-1 -Refer to Figure 11-1. The box labeled C represents what type of good?

Figure 11-1 -Refer to Figure 11-1. A gym membership at a gym that always has space in classes and on machines is an example of the type of good represented by Box

Which city currently charges drivers a "congestion toll" to drive into the heart of the city's financial, legal, and entertainment district?

"Given that most people like to get 'free stuff,' it follows that goods that are available free of charge are produced and consumed in the proper amounts in a market economy." What is wrong with this statement?

What is the main difficulty facing cost-benefit analysts when they attempt to evaluate the worthiness of proposed public projects?

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Application: The Costs of Taxation

Application: International Trade

Externalities

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers in Microeconomics

Filters

Exam 11: Public Goods and Common Resources

Knowledge is an example of a

For most goods in an economy, the primary signal that guides the decisions of buyers and sellers is

Because public goods are

Goods that are not excludable include both

When goods do not have a price, which of the following primarily ensures that the good is produced?

Figure 11-1 -Refer to Figure 11-1. The box labeled D represents what type of good?

Stewart is a lobsterman. His traps are

Under which of the following scenarios would a park be considered a club good?

The U.S. patent system

In almost all cases of common resources, the same problem arises as in the Tragedy of the __________.

The free-rider problem

Why does the commercial value of ivory threaten the elephant, while the commercial value of beef protects the cow?

Pollution is a negative externality, but it is not appropriate to view the problem of pollution as a common-resource problem.

Figure 11-1 -Refer to Figure 11-1. The box labeled C represents what type of good?

Figure 11-1 -Refer to Figure 11-1. A gym membership at a gym that always has space in classes and on machines is an example of the type of good represented by Box

Which city currently charges drivers a "congestion toll" to drive into the heart of the city's financial, legal, and entertainment district?

"Given that most people like to get 'free stuff,' it follows that goods that are available free of charge are produced and consumed in the proper amounts in a market economy." What is wrong with this statement?

What is the main difficulty facing cost-benefit analysts when they attempt to evaluate the worthiness of proposed public projects?

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Application: The Costs of Taxation

Application: International Trade

Externalities

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers in Microeconomics

Filters