Question 1

Voluntary programs, direct controls, and emissions taxes are all equally effective ways of controlling pollution.

Accepted Answer

A) True 
 B)False

Question 2

Suppose that because of climatic conditions, the smog levels in Los Angeles suddenly soar to dangerous levels.The most successful policy in this case would be

Accepted Answer

A) direct controls to limit driving. 
B) taxes on drivers at rush hours. 
C) voluntary cooperation to reduce driving. 
D) removal of autos with excessive emissions. 
A) direct controls to limit driving. 
B) taxes on drivers at rush hours. 
C) voluntary cooperation to reduce driving. 
D) removal of autos with excessive emissions.

Question 3

Discuss the role of individuals and governments in committing environmental damage.

Accepted Answer

Private individuals and government are m

Question 4

Describe how a pollution-control authority might use an emissions permits system to reduce pollution.

Accepted Answer

An authority could create a permit for a

Question 5

What are the advantages of a tax system for pollution control?

Accepted Answer

There are two main advantages of a tax s

Question 6

The supply curve of a depletable natural resource is usually

Accepted Answer

A) downward sloping because the resource runs out over time. 
B) upward sloping because more of the resource can be profitably extracted at higher prices. 
C) upward sloping because the price of the resource rises at the rate of inflation. 
D) vertical because the supply of the resource is fixed. 
A) downward sloping because the resource runs out over time. 
B) upward sloping because more of the resource can be profitably extracted at higher prices. 
C) upward sloping because the price of the resource rises at the rate of inflation. 
D) vertical because the supply of the resource is fixed.

Question 7

Which of the following is most likely to reduce the consumption of an exhaustible natural resource?

Accepted Answer

A) A decrease in monopoly control of the market for the resource 
B) Government tax policies that give tax breaks to entrepreneurs who search for new reserves of the resource 
C) Implementation of a price ceiling for the resource below its equilibrium price 
D) Government macroeconomic policies that lower the interest rate on bonds 
A) A decrease in monopoly control of the market for the resource 
B) Government tax policies that give tax breaks to entrepreneurs who search for new reserves of the resource 
C) Implementation of a price ceiling for the resource below its equilibrium price 
D) Government macroeconomic policies that lower the interest rate on bonds

Question 8

Rising prices will discourage consumption and encourage conservation.

Accepted Answer

A) True 
 B)False

Question 9

Voluntary programs for reducing pollution

Accepted Answer

A) have been more successful in the United States in encouraging recycling than any other type of program. 
B) are most appropriate when surveillance and enforcement are impractical. 
C) work most reliably when voluntary reduction of pollution over a long period is encouraged. 
D) are enforced by legal authority. 
A) have been more successful in the United States in encouraging recycling than any other type of program. 
B) are most appropriate when surveillance and enforcement are impractical. 
C) work most reliably when voluntary reduction of pollution over a long period is encouraged. 
D) are enforced by legal authority.

Question 10

Unregulated markets will tend to

Accepted Answer

A) rapidly deplete any natural resource. 
B) naturally conserve any depletable natural resource by pushing up its price every year by a constant dollar amount. 
C) naturally conserve a depletable resource by pushing up its price at a constant rate every year. 
D) deplete a resource unless new supplies are found. 
A) rapidly deplete any natural resource. 
B) naturally conserve any depletable natural resource by pushing up its price every year by a constant dollar amount. 
C) naturally conserve a depletable resource by pushing up its price at a constant rate every year. 
D) deplete a resource unless new supplies are found.

Question 11

Global climate change will not

Accepted Answer

A) affect the migration patterns of animals. 
B) affect the amount of expected water in lakes, rivers, and streams. 
C) make it harder to grow crops. 
D) harm those living in coastal areas. 
A) affect the migration patterns of animals. 
B) affect the amount of expected water in lakes, rivers, and streams. 
C) make it harder to grow crops. 
D) harm those living in coastal areas.

Question 12

In practice, taxes on emissions of pollutants have been found to

Accepted Answer

A) be ineffective in encouraging firms to pollute less. 
B) significantly reduce pollution by taxed firms. 
C) be less reliable in reducing pollution than direct controls on pollution. 
D) cause failures of the pricing system. 
A) be ineffective in encouraging firms to pollute less. 
B) significantly reduce pollution by taxed firms. 
C) be less reliable in reducing pollution than direct controls on pollution. 
D) cause failures of the pricing system.

Question 13

The environmental problems of China is not caused by

Accepted Answer

A) a lack of central planning in the economy. 
B) the burning of low-quality, high-sulfur coal. 
C) a lack of pollution controls. 
D) the one-child policy of population control. 
A) a lack of central planning in the economy. 
B) the burning of low-quality, high-sulfur coal. 
C) a lack of pollution controls. 
D) the one-child policy of population control.

Question 14

One of the reasons that pollution problems are as large as they are is that

Accepted Answer

A) markets let individuals and firms deplete valuable resources without charging money for doing so. 
B) markets are incapable of incorporating valuable resources such as air and pure water. 
C) governments use resources without paying for them the way that individuals and firms must. 
D) markets are not an efficient means to address scarcity. 
A) markets let individuals and firms deplete valuable resources without charging money for doing so. 
B) markets are incapable of incorporating valuable resources such as air and pure water. 
C) governments use resources without paying for them the way that individuals and firms must. 
D) markets are not an efficient means to address scarcity.

Question 15

Skeptics have been historically incorrect about

Accepted Answer

A) the depletion of earth's most valuable resources.As resource prices increase, more discoveries have been made. 
B) market-based approaches in reducing pollution.Zero pollution has been achieved. 
C) the depletion of earth's most valuable resources.As resource prices decrease, firms are incentivized to sell all their holdings before prices continue to fall. 
D) state owned firms.They traditionally perform better than markets with pollution charges. 
A) the depletion of earth's most valuable resources.As resource prices increase, more discoveries have been made. 
B) market-based approaches in reducing pollution.Zero pollution has been achieved. 
C) the depletion of earth's most valuable resources.As resource prices decrease, firms are incentivized to sell all their holdings before prices continue to fall. 
D) state owned firms.They traditionally perform better than markets with pollution charges.

Question 16

Economic theory would suggest that rising oil prices would reduce the amount of oil exploration and extraction.

Accepted Answer

A) True 
 B)False

Question 17

The supply curve of a natural resource like oil has a positive slope because

Accepted Answer

A) the supply becomes closer to exhaustion as demand rises. 
B) it becomes more costly to find and develop supplies as demand rises. 
C) rents rise as output increases. 
D) indirect taxes rise with output. 
A) the supply becomes closer to exhaustion as demand rises. 
B) it becomes more costly to find and develop supplies as demand rises. 
C) rents rise as output increases. 
D) indirect taxes rise with output.

Question 18

Direct controls work only if the legal system imposes substantial penalties on violators.

Accepted Answer

A) True 
 B)False

Question 19

Economic theory predicts that the price of a depletable resource will rise as it becomes more scarce.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following would not lead to more conservation?

Accepted Answer

A) Higher prices for a resource 
B) Increased interest rates on bonds 
C) Public awareness of increasing scarcity 
D) Higher taxes on goods produced using the resource 
A) Higher prices for a resource 
B) Increased interest rates on bonds 
C) Public awareness of increasing scarcity 
D) Higher taxes on goods produced using the resource

Exam 16: The Economics of the Environment, and Natural Resources

Voluntary programs, direct controls, and emissions taxes are all equally effective ways of controlling pollution.

Suppose that because of climatic conditions, the smog levels in Los Angeles suddenly soar to dangerous levels.The most successful policy in this case would be

Discuss the role of individuals and governments in committing environmental damage.

Describe how a pollution-control authority might use an emissions permits system to reduce pollution.

What are the advantages of a tax system for pollution control?

The supply curve of a depletable natural resource is usually

Which of the following is most likely to reduce the consumption of an exhaustible natural resource?

Rising prices will discourage consumption and encourage conservation.

Voluntary programs for reducing pollution

Unregulated markets will tend to

Global climate change will not

In practice, taxes on emissions of pollutants have been found to

The environmental problems of China is not caused by

One of the reasons that pollution problems are as large as they are is that

Skeptics have been historically incorrect about

Economic theory would suggest that rising oil prices would reduce the amount of oil exploration and extraction.

The supply curve of a natural resource like oil has a positive slope because

Direct controls work only if the legal system imposes substantial penalties on violators.

Economic theory predicts that the price of a depletable resource will rise as it becomes more scarce.

Which of the following would not lead to more conservation?

What Is Economics

The Economony: Myth and Reality

The Fundamental Economic Problem: Scarcity and Choice

Supply and Demand: an Initial Look

Consumer Choice: Individual and Market Demand

Demand and Elasticity

Production, Inputs, and Cost: Building Blocks for Supply Analysis

Output, Price, and Profit: the Importance of Marginal Analysis

The Financial Markets and the Economy: the Tail That Wags the Dog

The Firm and the Industry Under Perfect Competition

The Case for Free Markets: the Price System

Monopoly

Between Competition and Monopoly

Limiting Market Power: Antitrust and Regulation

The Shortcomings of Free Markets

Taxation and Resource Allocation

Pricing the Factors of Production

Labor and Entrepreneurship: the Human Inputs

Poverty, Inequality, and Discrimination

An Introduction to Macroeconomics

The Goals of Macroeconomic Policy

Economic Growth: Theory and Policy

Aggregate Demand and the Powerful Consumer

Demand-Side Equilibrium: Unemployment or Inflation

Bringing in the Supply Side: Unemployment and Inflation

Managing Aggregate Demand: Fiscal Policy

Money and the Banking System

Monetary Policy: Conventional and Unconventional

The Financial Crisis and the Great Recession

The Debate Over Monetary and Fiscal Policy

Budget Deficits in the Short and Long Run

The Trade-Off Between Inflation and Unemployment

International Trade and Comparative Advantage

The International Monetary System: Order or Disorder

Exchange Rates and the Macroeconomy

Contemporary Issues in the Useconomy

Filters