Exam 5: Externalities, Environmental Policy, and Public Goods

What is a private benefit from consumption? What is a social benefit from consumption? When is the private benefit from consumption equal to the social benefit from consumption?

"Free riding" is a characteristic of which type of good?

Figure 5-3 -Refer to Figure 5-3.In the absence of any government intervention, the private market

When products that create positive externalities are produced, at the market equilibrium output, the social benefit generated by consuming the product exceeds the private benefit.

Figure 5-2 Figure 5-2 shows a market with a negative externality. -Refer to Figure 5-2.The marginal benefit of the last unit produced is represented by the price

Getting an annual flu shot is a way to reduce the chances of not only contracting influenza, but also spreading it to other people.In this sense, getting an annual flu shot is reducing ________ of spreading a contagious disease.

Which of the following is an example of a Pigovian tax?

Figure 5-10 Chicken pox vaccinations for toddlers benefit society by protecting young children and by preventing an epidemic of the disease. Thus, the marginal social benefits of chicken pox vaccinations exceed the marginal private benefit for any quantity of vaccinations as illustrated in Figure 5-10. -Refer to Figure 5-10.What is the value of the net gain to society as a result of subsidizing chicken pox vaccinations?

Suppose a tax equal to the value of the marginal external cost at the optimal output is imposed on a pollution generating good.All of the following will result from the tax except

Issuing tradable emission allowances to polluting firms will result in those firms polluting more than is socially desirable.

Assume that air pollution from a copper smelter imposes external costs on people who live near the smelter.If the Coase theorem holds and the victims of the pollution could not legally enforce the right of their property not to be damaged, the amount of pollution reduction

A major problem with using a tradable emission allowances system to control pollution is

Which of the following best illustrates free riding?

Parents who do not have their children immunized and attempt to benefit from other parents who did have their own children immunized are exhibiting an economic behavior known as

Free riding refers to a situation in which

Overuse of a common resource may be avoided by all of the following methods except

Negative externalities and the tragedy of the commons are problems that have a common source.What is this common source?

Worldwide annual carbon dioxide emissions increased from about 198 million metric tons in 1850 to ________ million metric tons in 2015.

Which of the following displays rivalry and excludability in consumption?

When there is a positive externality,