Question 1

Which of the following is a public good?

Accepted Answer

A) city parking spots 
B) protection of the ozone layer 
C) computers 
D) the Internet 
A) city parking spots 
B) protection of the ozone layer 
C) computers 
D) the Internet

Question 2

Both public goods and common resources are:

Accepted Answer

A) rival in consumption. 
B) nonexcludable. 
C) excludable. 
D) nonrival in consumption. 
A) rival in consumption. 
B) nonexcludable. 
C) excludable. 
D) nonrival in consumption.

Question 3

A television show like The Sopranos, for example, is:

Accepted Answer

A) rival and excludable. 
B) nonrival but excludable. 
C) rival but nonexcludable. 
D) nonrival and nonexcludable. 
A) rival and excludable. 
B) nonrival but excludable. 
C) rival but nonexcludable. 
D) nonrival and nonexcludable.

Question 4

An excludable good is:

Accepted Answer

A) one that is excluded from the common basket of goods consumed by households. 
B) one that producers will exclude from production. 
C) one where people can be prevented from using the good. 
D) not necessary to consume, a luxury. 
A) one that is excluded from the common basket of goods consumed by households. 
B) one that producers will exclude from production. 
C) one where people can be prevented from using the good. 
D) not necessary to consume, a luxury.

Question 5

Since everyone can be made better off by taxation to provide apublic good, everyone will be better off.

Accepted Answer

A) True 
 B)False

Question 6

The tragedy of the commons is often the result of:

Accepted Answer

A) excludability and rivalry. 
B) excludability and nonrivalry. 
C) nonexcludability and rivalry. 
D) nonexcludability and nonrivalry. 
A) excludability and rivalry. 
B) excludability and nonrivalry. 
C) nonexcludability and rivalry. 
D) nonexcludability and nonrivalry.

Question 7

Mosquito control must be provided by government because if:

Accepted Answer

A) a lot of people free ride then mosquito control would be overprovided by the market. 
B) a lot of people free ride then mosquito control would be underprovided by the market. 
C) only few people are benefited then mosquito control would be overprovided by the market. 
D) only few people are benefited then mosquito control would be underprovided by the market. 
A) a lot of people free ride then mosquito control would be overprovided by the market. 
B) a lot of people free ride then mosquito control would be underprovided by the market. 
C) only few people are benefited then mosquito control would be overprovided by the market. 
D) only few people are benefited then mosquito control would be underprovided by the market.

Question 8

A public good is a good produced in the public sector.

Accepted Answer

A) True 
 B)False

Question 9

Overutilization and lack of conservation are more likely aproblem for:

Accepted Answer

A) private goods. 
B) material goods. 
C) goods that are not owned. 
D) cows and chickens. 
A) private goods. 
B) material goods. 
C) goods that are not owned. 
D) cows and chickens.

Question 10

Asteroid deflection would be considered a:

Accepted Answer

A) public good since it is rival and nonexcludable. 
B) public good since it is nonrival and nonexcludable.(True Answer )Correct 
C) private good since it is rival and excludable. 
D) private good since it is nonrival and excludable. 
A) public good since it is rival and nonexcludable. 
B) public good since it is nonrival and nonexcludable.(True Answer )Correct 
C) private good since it is rival and excludable. 
D) private good since it is nonrival and excludable.

Question 11

Why have systems similar to New Zealand's "individualtransfer quota" system not been able to protect all animal lifethat is in danger of being overexploited?

Accepted Answer

A) because at present the tuna fish is not the only fish in danger of being overfished 
B) because other countries do not have the backing of their governments the way that New Zealand does 
C) because property rights are difficult to establish in animals that migrate over borders 
D) None of these answers is correct. 
A) because at present the tuna fish is not the only fish in danger of being overfished 
B) because other countries do not have the backing of their governments the way that New Zealand does 
C) because property rights are difficult to establish in animals that migrate over borders 
D) None of these answers is correct.

Question 12

Which of the following examples specifies the cause of thetragedy of the common?

Accepted Answer

A) People like to eat chicken so demand for chicken has significantly increased. 
B) The supply of chicken is plentiful, causing the profit margin of selling chicken to decrease. 
C) Tuna in the ocean are not privately owned so fishermen have an incentive to overfish. 
D) The supply of tuna is rare, creating high profit margins and incentives for fishermen to underfish tuna. 
A) People like to eat chicken so demand for chicken has significantly increased. 
B) The supply of chicken is plentiful, causing the profit margin of selling chicken to decrease. 
C) Tuna in the ocean are not privately owned so fishermen have an incentive to overfish. 
D) The supply of tuna is rare, creating high profit margins and incentives for fishermen to underfish tuna.

Question 13

Solving a tragedy of the commons problem could be donethrough:
I. societal expectations
II.tradable allowances
III. government command and control methods.

Accepted Answer

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

Question 14

Which country created property rights to catching fish in 1986?

Accepted Answer

A) Mexico 
B) Puerto Rico 
C) Australia 
D) New Zealand 
A) Mexico 
B) Puerto Rico 
C) Australia 
D) New Zealand

Question 15

It is difficult to get people to pay for public goods voluntarilybecause these goods are:

Accepted Answer

A) excludable, and therefore markets tend to overprovide them. 
B) excludable, and therefore markets tend to underprovide them. 
C) nonexcludable, and therefore markets tend to overprovide them. 
D) nonexcludable, and therefore, markets tend to underprovide them. 
A) excludable, and therefore markets tend to overprovide them. 
B) excludable, and therefore markets tend to underprovide them. 
C) nonexcludable, and therefore markets tend to overprovide them. 
D) nonexcludable, and therefore, markets tend to underprovide them.

Question 16

Which of the following does NOT make the tragedy of thetuna commons even worse?

Accepted Answer

A) Multiple countries tag and track tuna throughout the Pacific. 
B) Many fishermen are involved in fishing tuna. 
C) Governments subsidize fishing extensively. 
D) Demand for tuna has decreased significantly.(True Answer )Correct 
A) Multiple countries tag and track tuna throughout the Pacific. 
B) Many fishermen are involved in fishing tuna. 
C) Governments subsidize fishing extensively. 
D) Demand for tuna has decreased significantly.(True Answer )Correct

Question 17

When public goods are funded through advertising, theproblems of both free and forced riders can be mitigated.

Accepted Answer

A) True 
 B)False

Question 18

Public goods are:
I. excludable
II.nonrival
III. free to those who do not pay.

Accepted Answer

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

Question 19

Why is national defense a public good?
i. because it is expensive to produceII. because people who don't pay for national defense stillbenefit from having itIII. because one person's benefit from national defense doesn'treduce anyone else's benefit from itIV. because it is provided by the government

Accepted Answer

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

Question 20

A good is nonrival if:

Accepted Answer

A) the good does not cause rivalry between the people using the good. 
B) the good potentially creates rivalry between the people using the good. 
C) one person's use of the good reduces the ability of another person to use the same good. 
D) one person's use of the good does not reduce the ability of another person to use the same good. 
A) the good does not cause rivalry between the people using the good. 
B) the good potentially creates rivalry between the people using the good. 
C) one person's use of the good reduces the ability of another person to use the same good. 
D) one person's use of the good does not reduce the ability of another person to use the same good.

Exam 18: Public Economy

Which of the following is a public good?

Both public goods and common resources are:

A television show like The Sopranos, for example, is:

An excludable good is:

Since everyone can be made better off by taxation to provide apublic good, everyone will be better off.

The tragedy of the commons is often the result of:

Mosquito control must be provided by government because if:

A public good is a good produced in the public sector.

Overutilization and lack of conservation are more likely aproblem for:

Asteroid deflection would be considered a:

Why have systems similar to New Zealand's "individualtransfer quota" system not been able to protect all animal lifethat is in danger of being overexploited?

Which of the following examples specifies the cause of thetragedy of the common?

Solving a tragedy of the commons problem could be donethrough: I. societal expectations II.tradable allowances III. government command and control methods.

Which country created property rights to catching fish in 1986?

It is difficult to get people to pay for public goods voluntarilybecause these goods are:

Which of the following does NOT make the tragedy of thetuna commons even worse?

When public goods are funded through advertising, theproblems of both free and forced riders can be mitigated.

Public goods are: I. excludable II.nonrival III. free to those who do not pay.

A good is nonrival if:

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

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