Question 1

A good solution to saving the tiger from extinction would be to:

Accepted Answer

A) outlaw the sale of tiger bone 
B) tax the sale of tiger hides 
C) develop policies that make tigers more like a private good 
D) regulate the use of traditional Asian medicines that use tiger bone 
A) outlaw the sale of tiger bone 
B) tax the sale of tiger hides 
C) develop policies that make tigers more like a private good 
D) regulate the use of traditional Asian medicines that use tiger bone

Question 2

In Australia, crocodiles are farmed for their leather and meat.Australian crocodile numbers have been increasing.In India, native crocodile species are protected and can't be harvested but populations have been falling.Explain why harvest in Australia has led to more crocodiles and contrast with India.

Accepted Answer

Differences in property-rights mean diff

Question 3

Free-to-air television is an example of a club good.

Accepted Answer

A) True 
 B)False

Question 4

Private goods are:

Accepted Answer

A) excludable and rival 
B) non-excludable and rival 
C) excludable and non-rival 
D) non-excludable and non-rival 
A) excludable and rival 
B) non-excludable and rival 
C) excludable and non-rival 
D) non-excludable and non-rival

Question 5

What combination of policies has the Singapore Government used to reduce road congestion and pollution? Why wouldn't this reduction in road congestion occur without government intervention?

Accepted Answer

Singapore limits the number of cars on t

Question 6

A fireworks display is a rival good because one person's enjoyment of the fireworks does not reduce anyone else's enjoyment.

Accepted Answer

A) True 
 B)False

Question 7

In modern industrialised economies there are goods that can be consumed without paying for them.

Accepted Answer

A) True 
 B)False

Question 8

Some goods can switch between being public goods and private goods, depending on the circumstances.

Accepted Answer

A) True 
 B)False

Question 9

To decide whether a public good should be provided, the government needs to know:
(i) what the costs to society of providing the good are
(ii) what the benefits to society of providing the good are
(iii) what price people pay for the good in an actual market

Accepted Answer

A) (i) and (ii) 
B) (i) and (iii) 
C) (i) only 
D) (i), (ii) and (iii) 
A) (i) and (ii) 
B) (i) and (iii) 
C) (i) only 
D) (i), (ii) and (iii)

Question 10

Roads can be considered either public goods or common resources, depending on how congested they are.

Accepted Answer

A) True 
 B)False

Question 11

Some advocates of anti-poverty programs claim that fighting poverty is a public good.Explain what these advocates mean by classifying charity as a public good.What does this have to do with the need for government intervention?

Accepted Answer

Eliminating poverty is not a good that t

Question 12

The private market would not supply the optimal amount of national defence because:

Accepted Answer

A) private citizens don't value national defence enough to cover the cost of private provision 
B) no-one has the right to attach a price to it and profit from its use 
C) private suppliers are unable to produce national defence 
D) the government would quickly take advantage of the profit opportunity and undersell to the private suppliers 
A) private citizens don't value national defence enough to cover the cost of private provision 
B) no-one has the right to attach a price to it and profit from its use 
C) private suppliers are unable to produce national defence 
D) the government would quickly take advantage of the profit opportunity and undersell to the private suppliers

Question 13

Residents of Hang-Zhou, China, like seeing fireworks during their Chinese New Year celebration.Each of the city's one million residents places a value of $1 on the fireworks experience.The cost of providing the fireworks is $250 000.Which of the following statements is most correct?

Accepted Answer

A) because the collective benefits exceed the cost, the private market will provide an efficient number of fireworks 
B) an entrepreneur in Hang-Zhou is likely to provide some amount of fireworks for residents of the city and the provision level is likely to be efficient 
C) fireworks are not excludable so private markets will not produce an efficient outcome 
D) because China is a communist country, market incentives are irrelevant to how people behave 
A) because the collective benefits exceed the cost, the private market will provide an efficient number of fireworks 
B) an entrepreneur in Hang-Zhou is likely to provide some amount of fireworks for residents of the city and the provision level is likely to be efficient 
C) fireworks are not excludable so private markets will not produce an efficient outcome 
D) because China is a communist country, market incentives are irrelevant to how people behave

Question 14

All animals with a commercial value are protected from extinction by market forces.

Accepted Answer

A) True 
 B)False

Question 15

Because the benefit each citizen receives from having an educated community is a public good:

Accepted Answer

A) the free-rider problem causes the private market to undersupply education to the community 
B) the government can potentially help the market reach a socially optimal level of education 
C) a tax increase to pay for education could potentially make the community better off 
D) all of the above are true 
A) the free-rider problem causes the private market to undersupply education to the community 
B) the government can potentially help the market reach a socially optimal level of education 
C) a tax increase to pay for education could potentially make the community better off 
D) all of the above are true

Question 16

An example of a market failure associated with the provision of public good in the private market is:

Accepted Answer

A) free-riders pay too much for the good, so it is undersupplied 
B) free-riders don't pay for the good, so it is undersupplied 
C) free-riders pay too much for the good, so it is oversupplied 
D) free-riders don't pay for the good, so it is oversupplied 
A) free-riders pay too much for the good, so it is undersupplied 
B) free-riders don't pay for the good, so it is undersupplied 
C) free-riders pay too much for the good, so it is oversupplied 
D) free-riders don't pay for the good, so it is oversupplied

Question 17

What is necessary to convert a wireless internet connection into a common resource?

Accepted Answer

A) low connection fees 
B) high connection fees 
C) no encryption on the network 
D) encryption on the network 
A) low connection fees 
B) high connection fees 
C) no encryption on the network 
D) encryption on the network

Question 18

If tuna fish are an oceanic common resource then:

Accepted Answer

A) preventing over-harvest won't need international cooperation 
B) fishers will try to limit their catches without government regulations 
C) enforcing agreements to limit fishing will be difficult 
D) all of the above 
A) preventing over-harvest won't need international cooperation 
B) fishers will try to limit their catches without government regulations 
C) enforcing agreements to limit fishing will be difficult 
D) all of the above

Exam 11: Public Goods and Common Resources

A good solution to saving the tiger from extinction would be to:

Free-to-air television is an example of a club good.

Private goods are:

What combination of policies has the Singapore Government used to reduce road congestion and pollution? Why wouldn't this reduction in road congestion occur without government intervention?

A fireworks display is a rival good because one person's enjoyment of the fireworks does not reduce anyone else's enjoyment.

In modern industrialised economies there are goods that can be consumed without paying for them.

Some goods can switch between being public goods and private goods, depending on the circumstances.

To decide whether a public good should be provided, the government needs to know: (i) what the costs to society of providing the good are (ii) what the benefits to society of providing the good are (iii) what price people pay for the good in an actual market

Roads can be considered either public goods or common resources, depending on how congested they are.

Some advocates of anti-poverty programs claim that fighting poverty is a public good.Explain what these advocates mean by classifying charity as a public good.What does this have to do with the need for government intervention?

The private market would not supply the optimal amount of national defence because:

Residents of Hang-Zhou, China, like seeing fireworks during their Chinese New Year celebration.Each of the city's one million residents places a value of $1 on the fireworks experience.The cost of providing the fireworks is $250 000.Which of the following statements is most correct?

All animals with a commercial value are protected from extinction by market forces.

Because the benefit each citizen receives from having an educated community is a public good:

An example of a market failure associated with the provision of public good in the private market is:

What is necessary to convert a wireless internet connection into a common resource?

If tuna fish are an oceanic common resource then:

Ten Lessons From 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

Application: 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

Business Strategy and Oligopoly

Competition Policy

The Markets for the Factors of Production

Earnings, Unions and Discrimination

Income Inequity and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment and the Financial System

The Natural Rate of Unemployment

The Monetary System

Inflation: Its Causes and Costs

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 Trade-Off Between Inflation and Unemployment

Global Financial Crisis of 2008 and Beyond

Five Debates Over Macroeconomic Policy

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