Question 1

Are whales excludable? Are they rival in consumption? How do we classify whales in terms of the four types of goods?

Accepted Answer

Whales are not excludable, but

Question 2

Government intervention cannot improve the allocation of resources for goods that do not have prices attached to them.

Accepted Answer

A) True 
 B)False

Question 3

Are public goods excludable? Are they rival in consumption?

Accepted Answer

No, public goods are

Question 4

Which of the following pairs of goods includes a good that is excludable and rival in consumption as well as a good that is not excludable and not rival in consumption?

Accepted Answer

A) Tablet computer, membership at a gym that always has plenty of open equipment and classes 
B) Tablet computer, national defense 
C) Congested nontoll road, national defense 
D) Online music subscription, streetlight 
A) Tablet computer, membership at a gym that always has plenty of open equipment and classes 
B) Tablet computer, national defense 
C) Congested nontoll road, national defense 
D) Online music subscription, streetlight

Question 5

Which two types of goods are excludable?

Accepted Answer

Private go

Question 6

The free-rider problem arises when the number of beneficiaries is large and exclusion of any of them is impossible.

Accepted Answer

A) True 
 B)False

Question 7

Someone who uses a good without paying for it is called a ?

Accepted Answer

The answer of Someone who uses a good without paying...

Question 8

The free-rider problem makes it unlikely that poverty will be entirely eliminated through private charity.

Accepted Answer

A) True 
 B)False

Question 9

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 10

Which of the following is not a common resource?

Accepted Answer

A) Lions in the wild 
B) A hiking trail in a public park 
C) A vegetable garden 
D) Fresh water 
A) Lions in the wild 
B) A hiking trail in a public park 
C) A vegetable garden 
D) Fresh water

Question 11

Under which of the following scenarios would a park be considered a common resource?

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 12

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

Accepted Answer

A) True 
 B)False

Question 13

The mayor of Newton is considering proposals to deal with an unsafe intersection. She could install a traffic light at a cost of $50,000 or she could install stop signs at a cost of $5,000. The traffic light is expected to reduce the risk of fatality by 0.45 percent and the stop signs are expected to reduce the risk of fatality by 0.054 percent. If the value of human life is estimated to be $10 million, what choice should the mayor make? Briefly explain.

Accepted Answer

The mayor should install stop

Question 14

In what way do common resources give rise to negative externalities?

Accepted Answer

When one person uses a common

Question 15

The phenomenon of free riding is most closely associated with which type of good?

Accepted Answer

A) Private goods 
B) Club goods 
C) Inferior goods 
D) Public goods 
A) Private goods 
B) Club goods 
C) Inferior goods 
D) Public goods

Question 16

Pay-per-view broadcasts are

Accepted Answer

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

Question 17

Imagine a 2,000-acre park with picnic benches, trees, and a pond. Suppose it is publicly owned, and people are invited to enjoy its beauty. When the weather is nice, it is difficult to find parking, and the trash cans overflow with food wrappers on summer afternoons. Otherwise, it is a great place. The park is a common resource because

Accepted Answer

A) people can be prevented from using it. 
B) access is limited due to driving distances. 
C) if too many people use it, one person's use diminishes other peoples' use. 
D) anyone can use it without affecting anyone else. 
A) people can be prevented from using it. 
B) access is limited due to driving distances. 
C) if too many people use it, one person's use diminishes other peoples' use. 
D) anyone can use it without affecting anyone else.

Question 18

Which of the following is a disadvantage of government provision of a public good?

Accepted Answer

A) The government lacks information about the value people place on the good. 
B) The government does not provide enough of any public good. 
C) The private sector can provide all public goods at a lower cost. 
D) There are no disadvantages of government provision of a public good. 
A) The government lacks information about the value people place on the good. 
B) The government does not provide enough of any public good. 
C) The private sector can provide all public goods at a lower cost. 
D) There are no disadvantages of government provision of a public good.

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

In what way do public goods give rise to positive externalities?

Accepted Answer

When one person provides a pub

Exam 11: Public Goods and Common Resources

Are whales excludable? Are they rival in consumption? How do we classify whales in terms of the four types of goods?

Government intervention cannot improve the allocation of resources for goods that do not have prices attached to them.

Are public goods excludable? Are they rival in consumption?

Which of the following pairs of goods includes a good that is excludable and rival in consumption as well as a good that is not excludable and not rival in consumption?

Which two types of goods are excludable?

The free-rider problem arises when the number of beneficiaries is large and exclusion of any of them is impossible.

Someone who uses a good without paying for it is called a ?

The free-rider problem makes it unlikely that poverty will be entirely eliminated through private charity.

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

Which of the following is not a common resource?

Under which of the following scenarios would a park be considered a common resource?

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

In what way do common resources give rise to negative externalities?

The phenomenon of free riding is most closely associated with which type of good?

Pay-per-view broadcasts are

Which of the following is a disadvantage of government provision of a public good?

"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?

In what way do public goods give rise to positive externalities?

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

Applications: 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

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

Tools of Finance

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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