Exam 11: Public Goods and Common Resources

Scenario 11-2 Consider the following goods: • fire-protection services provided by a fire department • a beautiful mural on the outside wall of a fire station • a firefighter's helmet -Refer to Scenario 11-2. Which of these goods is the best example of a public good? Briefly explain.

Bob owns 5 acres of land. Bob sells the land to a real estate developer who builds a subdivision with 10 houses. The land is an example of a good that is

A vacation home in Malibu is

Which of the following statements is correct?

To increase safety at a bad intersection, the mayor must decide whether to install a traffic light at a cost of $45,000. If the traffic light reduces the risk of fatality by 0.4 percent, and the value of a human life is estimated to be $10 million, the mayor should

Four roommates share an off-campus house and equally share the cost of rent. Everyone says that she values a clean house, yet the house is usually dirty. To an economist, a clean house in this case represents

A New York legislator wanted to create a deposit on cigarettes butts. If implemented, people would have the incentive to (1) not toss cigarette butts onto public streets and sidewalks, and (2) pick butts up to redeem them for the cash. The degradation of the environment from littered cigarette butts is a

If one person's use of good x diminishes other people's use of it, then good x is one of two types of goods. What are those two types?

Which of the following is a disadvantage of government provision of a public good such as national defense? (i) The government does not know the exact willingness of consumers to pay for the public good.(ii) The free-rider problem is more likely to occur when the government provides a public good than when the private sector provides a public good.(iii) Taxpayers do not agree on the optimal quantity of the public good that the government should provide.

Recall the four types of goods. Are national defense and a patented invention the same type of good? Briefly explain.

Drivers have to pay a toll to drive on certain roads. In essence, a toll is a corrective tax on the externality of __________.

Concerts in arenas are not excludable because it is virtually impossible to prevent someone from seeing the show.

Ten friends who love to ski decide to pool their financial resources and equally share the cost of a one-week time-share condominium in Alta, Utah. Suppose that the lift lines at the ski resort become more congested when the ten additional people start to ski. Which of the following statements is not correct?

The degradation of the environment from litter is a

An internet radio broadcast is

Which of the following statements about private goods and public goods is correct?

When a free-rider problem exists,

Seymour owns 3 acres of beautiful waterfront property on a large inland lake. In his will, Seymour donates the land to the state with the understanding that the land will be used as a state beach that anyone may use without paying any fees. This state beach

Variable tolls on roads

A mobile phone is a