Exam 17: Public Goods and Common Resources

Common resources tend to be overused because:

Whenever a species is threatened with extinction, it is likely that:

Suppose the Alaskan king crab harvest is unregulated and any person with a boat can go offshore, lower a crab pot, and harvest king crab.This common resource will likely be ________ because the marginal social cost of harvesting crabs _.

The best example of an artificially scarce good is:

The private market will lead to ________of clean air because _.

(Table: Street Cleanings) Peter and Wendy both benefit from having cleaner streets.The table Street Cleanings shows the relationship between the number of street cleanings per month and the total benefit they get.Suppose that the marginal cost of street cleaning is $18 per cleaning.Then:

If the marginal benefit received from a good is equal to the marginal opportunity cost of production, then:

Figure: Market Failure (Figure: Market Failure) In the figure Market Failure, if production in this competitive market is at quantity E, then:

Figure: Traffic Lights in Plymouth (Figure: Traffic Lights in Plymouth) Plymouth has 1,000 residents.The figure Traffic Lights in Plymouth shows the marginal social benefit and marginal cost of traffic lights in town.We know that each resident has the same individual marginal benefit per traffic light.If the town's population doubles and the new residents share the identical individual marginal benefit of the existing residents, the socially efficient quantity of traffic lights will:

A(n) is excludable and rival in consumption.

A characteristic of public goods is that:

When a good is nonrival in consumption, the most efficient price for the consumption of the good is:

On hot summer days, beach parking lots are usually full by early morning even though one must pay in order to park there.Parking at such lots is:

Scenario: Alexander and Vanessa Two individuals, Alexander and Vanessa, benefit from scientific research.Alexander's marginal private benefit from such research is given by the equation P = 200 - Q, where Q refers to the amount of research undertaken and P is the price Alexander is willing to pay for such research.Vanessa's marginal private benefit from such research is given by the equation P = 100 - Q.Suppose the marginal social cost of engaging in such research is constant at $100. (Scenario: Alexander and Vanessa) Refer to the information in the scenario Alexander and Vanessa.If the socially optimal level of scientific research is produced and if both Vanessa and Alexander are truthful in disclosing the marginal private benefits they expect to receive from this research, what is the price per unit of research that Vanessa is willing to pay?

Figure: Market Failure (Figure: Market Failure) Look at the figure Market Failure.Suppose it represents the demand and marginal cost of pounds of shrimp in the bay.The additional cost of the shrimp due to the depletion of the common resource is equal to AC.The efficient output of shrimp is

(Table: Marginal Benefit of Fire Hydrants) Bob and Nancy live in a new housing development and they would like to have fire hydrants installed.The table Marginal Benefit of Fire Hydrants shows Bob's and Nancy's individual marginal benefits of different quantities of fire hydrants.Suppose that the marginal cost of installing a hydrant is $10.a) What is the most that Nancy would be willing to pay to have one hydrant installed in the neighborhood? b) If Nancy had to pay for fire hydrants on her own, how many hydrants would there be? c) What is the optimal number of fire hydrants in the neighborhood?

A market produces too much of a good when the price of the good is:

If the marginal benefit received from a good is less than the marginal social cost of production, then:

(Table: Total Cost and Total Individual Benefit) The table Total Cost and Total Individual Benefit refers to animal control for residents of a small town.If the residents acted together, how many officers would they hire?

An e-Book is similar to a published book in that it is , but it is also similar to national defense in that it is _.