Question 1

Schooling is a public good.

Accepted Answer

A) True 
 B)False  False

Question 2

Nonrival private goods are likely to have ________ fixed costsand ________ marginal costs.

Accepted Answer

A) small; large 
B) no; small 
C) large; small 
D) large; no 
A) small; large 
B) no; small 
C) large; small 
D) large; no C

Question 3

If you give a firm $1,000 to protect the earth from asteroids:

Accepted Answer

A) your contribution will not have an effect on whether the firm will be successful in protecting the earth.(True Answer
)Correct 
B) your contribution will be vital in determining whether the firm will have enough resources to combat
Asteroids. 
C) your family will now have adequate protection. 
D) you are considered a free-rider of public goods. 
A) your contribution will not have an effect on whether the firm will be successful in protecting the earth.(True Answer
)Correct 
B) your contribution will be vital in determining whether the firm will have enough resources to combat
Asteroids. 
C) your family will now have adequate protection. 
D) you are considered a free-rider of public goods. A

Question 4

Although the provision of nonrival private goods is ________,we typically consider it ________.

Accepted Answer

A) efficient; an inefficient allocation due to its nonrival nature 
B) inefficient; not that big a deal because we value diversity and creativity 
C) inefficient; a big deal because it leads to many forced riders 
D) efficient; a big deal because it leads to other types of market inefficiencies 
A) efficient; an inefficient allocation due to its nonrival nature 
B) inefficient; not that big a deal because we value diversity and creativity 
C) inefficient; a big deal because it leads to many forced riders 
D) efficient; a big deal because it leads to other types of market inefficiencies

Question 5

Solving a tragedy of the commons problem could be donethrough:
I. establishment of property rights over the common resource
II.the invisible hand
III. government-armed protection.

Accepted Answer

A) II only 
B) I and II only 
C) I and III only 
D) I, II, and III 
A) II only 
B) I and II only 
C) I and III only 
D) I, II, and III

Question 6

Toilet paper is a rival good because:

Accepted Answer

A) there is a lot of competition in the toilet paper market. 
B) it is a substitute good for a bidet. 
C) one person's use of toilet paper reduces the ability of another person to use the same sheets. 
D) it is made from natural resources. 
A) there is a lot of competition in the toilet paper market. 
B) it is a substitute good for a bidet. 
C) one person's use of toilet paper reduces the ability of another person to use the same sheets. 
D) it is made from natural resources.

Question 7

A common resource is:

Accepted Answer

A) likely to be overutilized. 
B) a good that, when used by one person, leaves less for everyone else. 
C) rival but nonexcludable. 
D) All of the answers are correct. 
A) likely to be overutilized. 
B) a good that, when used by one person, leaves less for everyone else. 
C) rival but nonexcludable. 
D) All of the answers are correct.

Question 8

Which of the following statements is correct?

Accepted Answer

A) It is paradoxical that people can be made better off by requiring them to do something that they would choose to do
Voluntarily. 
B) It is paradoxical that people cannot be made better off by requiring them to do something that they would choose to do
Voluntarily. 
C) Even though none contribute voluntarily, all would agree to be taxed as long as everyone else is also taxed.(True Answer
)Correct 
D) Even though everyone contributes voluntarily, none would agree to be taxed if everyone else is not taxed. 
A) It is paradoxical that people can be made better off by requiring them to do something that they would choose to do
Voluntarily. 
B) It is paradoxical that people cannot be made better off by requiring them to do something that they would choose to do
Voluntarily. 
C) Even though none contribute voluntarily, all would agree to be taxed as long as everyone else is also taxed.(True Answer
)Correct 
D) Even though everyone contributes voluntarily, none would agree to be taxed if everyone else is not taxed.

Question 9

Goods that are rival in consumption include both:

Accepted Answer

A) public goods and common resources. 
B) common resources and natural monopolies. 
C) common resources and private goods.(True Answer )Correct 
D) public goods and private goods. 
A) public goods and common resources. 
B) common resources and natural monopolies. 
C) common resources and private goods.(True Answer )Correct 
D) public goods and private goods.

Question 10

Goods can be classified as private goods or public goods,depending on the circumstances.

Accepted Answer

A) True 
 B)False

Question 11

Since people get to consume public goods regardless ofwhether they paid for them, the market will likely not produceenough public goods.

Accepted Answer

A) True 
 B)False

Question 12

(Table: Types of Goods) Refer to the table. Which of thefollowing statements is true?
I. Section 1 may contain fruit, chicken, and underwear
II.Section 2 may contain fish in the ocean, public roads, andpublic hunting grounds
III. Section 3 may contain Wi-Fi, cable TV, and digital music.IV. Section 4 may contain asteroid deflection, national defense,and radio.

Accepted Answer

A) I, II, and IV 
B) III and IV 
C) II only 
D) I, II, III, and IV 
A) I, II, and IV 
B) III and IV 
C) II only 
D) I, II, III, and IV

Question 13

Google provides a(n) ________ good, but uses advertising tomake its good ________.

Accepted Answer

A) excludable; nonexcludable 
B) common; more scarce 
C) nonexcludable; excludable 
D) public; private 
A) excludable; nonexcludable 
B) common; more scarce 
C) nonexcludable; excludable 
D) public; private

Question 14

A good is excludable if one person's use of the good reducesthe ability of another person to use the same good.

Accepted Answer

A) True 
 B)False

Question 15

Table: Example GoodsA WatermelonA LighthouseSmog ReductionOnline Video GamesCable Internet ServiceNational DefenseA Private BeachA Public BeachA PencilSoup Kitchen MealsA ChairToll HighwaysPublic RoadsReference: Ref 18-2(Table: Example Goods) Refer to the table. Which of thefollowing contains only public goods from the table?

Accepted Answer

A) a public beach, soup kitchen meals, public roads 
B) online video games, a public beach, national defense, a lighthouse 
C) a public beach, a lighthouse, toll highways, public roads 
D) national defense, a lighthouse, smog reduction (True Answer )Correct 
A) a public beach, soup kitchen meals, public roads 
B) online video games, a public beach, national defense, a lighthouse 
C) a public beach, a lighthouse, toll highways, public roads 
D) national defense, a lighthouse, smog reduction (True Answer )Correct

Question 16

Which of the following is a private good?

Accepted Answer

A) national defense 
B) cable TV 
C) soft drinks 
D) the environment 
A) national defense 
B) cable TV 
C) soft drinks 
D) the environment

Question 17

The tragedy of the commons problem is a type of negativeexternality.

Accepted Answer

A) True 
 B)False

Question 18

Nonexcludability cannot exist at the same time as marketefficiency in quantity.

Accepted Answer

A) True 
 B)False

Question 19

The need to produce public goods provides a strong argumentfor:

Accepted Answer

A) regulation and subsidy. 
B) regulation and government provision. 
C) taxation and subsidy. 
D) taxation and government provision. 
A) regulation and subsidy. 
B) regulation and government provision. 
C) taxation and subsidy. 
D) taxation and government provision.

Question 20

Which of the following would NOT be considered as anexample of public good?

Accepted Answer

A) asteroid deflection 
B) national defense 
C) mosquito control 
D) public roads 
A) asteroid deflection 
B) national defense 
C) mosquito control 
D) public roads

Schooling is a public good.

Nonrival private goods are likely to have fixed costsand marginal costs.

If you give a firm $1,000 to protect the earth from asteroids:

Although the provision of nonrival private goods is ,we typically consider it .

Solving a tragedy of the commons problem could be donethrough: I. establishment of property rights over the common resource II.the invisible hand III. government-armed protection.

Toilet paper is a rival good because:

A common resource is:

Which of the following statements is correct?

Goods that are rival in consumption include both:

Goods can be classified as private goods or public goods,depending on the circumstances.

Since people get to consume public goods regardless ofwhether they paid for them, the market will likely not produceenough public goods.

Google provides a(n) good, but uses advertising tomake its good .

A good is excludable if one person's use of the good reducesthe ability of another person to use the same good.

Which of the following is a private good?

The tragedy of the commons problem is a type of negativeexternality.

Nonexcludability cannot exist at the same time as marketefficiency in quantity.

The need to produce public goods provides a strong argumentfor:

Which of the following would NOT be considered as anexample of public good?

Welcome to Economics

Choice in a World of Scarcity

Demand and Supply

Labor and Financial Markets

Elasticity

Consumer Choices

Production, Costs, and Industry Structure

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Monopoly and Antitrust Policy

Environmental Protection and Negative Externalities

Positive Externalities and Public Goods

Labor Markets and Income

Poverty and Economic Inequality

Information, Risk, and Insurance

Financial Markets

International Trade

Globalization and Protectionism

Consumer Utility and Optimization

Filters

Exam 18: Public Economy

Schooling is a public good.

Nonrival private goods are likely to have ________ fixed costsand ________ marginal costs.

If you give a firm $1,000 to protect the earth from asteroids:

Although the provision of nonrival private goods is ________,we typically consider it ________.

Solving a tragedy of the commons problem could be donethrough: I. establishment of property rights over the common resource II.the invisible hand III. government-armed protection.

Toilet paper is a rival good because:

A common resource is:

Which of the following statements is correct?

Goods that are rival in consumption include both:

Goods can be classified as private goods or public goods,depending on the circumstances.

Since people get to consume public goods regardless ofwhether they paid for them, the market will likely not produceenough public goods.

Google provides a(n) ________ good, but uses advertising tomake its good ________.

A good is excludable if one person's use of the good reducesthe ability of another person to use the same good.

Which of the following is a private good?

The tragedy of the commons problem is a type of negativeexternality.

Nonexcludability cannot exist at the same time as marketefficiency in quantity.

The need to produce public goods provides a strong argumentfor:

Which of the following would NOT be considered as anexample of public good?

Welcome to Economics

Choice in a World of Scarcity

Demand and Supply

Labor and Financial Markets

Elasticity

Consumer Choices

Production, Costs, and Industry Structure

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Monopoly and Antitrust Policy

Environmental Protection and Negative Externalities

Positive Externalities and Public Goods

Labor Markets and Income

Poverty and Economic Inequality

Information, Risk, and Insurance

Financial Markets

International Trade

Globalization and Protectionism

Consumer Utility and Optimization

Filters

Nonrival private goods are likely to have fixed costsand marginal costs.

Although the provision of nonrival private goods is ,we typically consider it .

Google provides a(n) good, but uses advertising tomake its good .