Question 1

What results when a free-rider problem exists

Accepted Answer

A) Too few resources are devoted to the good. 
B) The cost of the good will always be more than the benefit of the good. 
C) The good will not be produced. 
D) Entrepreneurs will eventually find a way to make free riders pay their share. 
A) Too few resources are devoted to the good. 
B) The cost of the good will always be more than the benefit of the good. 
C) The good will not be produced. 
D) Entrepreneurs will eventually find a way to make free riders pay their share.

Question 2

What do advocates of antipoverty programs believe about fighting poverty

Accepted Answer

A) It can make everyone better off. 
B) It is most successfully done by charities. 
C) It can be done efficiently by the market system. 
D) It should not be done with tax dollars. 
A) It can make everyone better off. 
B) It is most successfully done by charities. 
C) It can be done efficiently by the market system. 
D) It should not be done with tax dollars.

Question 3

Based on "The Dismal Education" by Yoram Bauman,what is the main reason that students majoring in economics tend to contribute less to public goods than other students

Accepted Answer

Public goods run counter to Adam Smith's

Question 4

What is knowledge an example of

Accepted Answer

A) a public good 
B) a private good 
C) a common resource 
D) a club good 
A) a public good 
B) a private good 
C) a common resource 
D) a club good

Question 5

Suppose that the cost of installing an overhead pedestrian walkway in a college town is $50,000.If the walkway is expected to reduce the risk of fatality by 0.5 percent and the cost of a human life is estimated at $5 million,what would the town do

Accepted Answer

A) The town would install the walkway because the estimated benefit is twice the cost. 
B) The town would install the walkway because the estimated benefit equals the cost. 
C) The town would not install the walkway since the cost is twice the estimated benefit. 
D) The town would install the walkway since the cost of even a single life is too great. 
A) The town would install the walkway because the estimated benefit is twice the cost. 
B) The town would install the walkway because the estimated benefit equals the cost. 
C) The town would not install the walkway since the cost is twice the estimated benefit. 
D) The town would install the walkway since the cost of even a single life is too great.

Question 6

Why is basic research a public good

Accepted Answer

A) It is difficult to exclude those who might benefit from it. 
B) It is used to develop public goods. 
C) It always benefits developed countries at the expense of developing countries. 
D) It is a rival in consumption good. 
A) It is difficult to exclude those who might benefit from it. 
B) It is used to develop public goods. 
C) It always benefits developed countries at the expense of developing countries. 
D) It is a rival in consumption good.

Question 7

When one person uses a common resource,which of the following outcomes will most likely occur

Accepted Answer

A) An externality will arise. 
B) Other people will be neither better nor worse off. 
C) It will be simple to charge him or her for usage of it. 
D) No one else will be able to use the common resource. 
A) An externality will arise. 
B) Other people will be neither better nor worse off. 
C) It will be simple to charge him or her for usage of it. 
D) No one else will be able to use the common resource.

Question 8

The government often intervenes when private markets fail to provide an optimal level of certain goods and services.For example,the government imposes an excise tax on gasoline to account for the negative externality that drivers impose on one another.Why might the private market not reach the socially optimal level of traffic on the road without the help of government

Accepted Answer

It is possible that everyone can agree t

Question 9

What are common resource goods

Accepted Answer

A) excludable but not rival in consumption 
B) rival in consumption but not excludable 
C) both excludable and rival in consumption 
D) neither excludable nor rival in consumption 
A) excludable but not rival in consumption 
B) rival in consumption but not excludable 
C) both excludable and rival in consumption 
D) neither excludable nor rival in consumption

Question 10

Once a common resource is available for consumption,what do policymakers need to be concerned with

Accepted Answer

A) making sure everyone gets a fair chance to consume 
B) how much is consumed 
C) creating laws that will completely forbid consumption in order to preserve the environment 
D) creating positive externalities from consuming the common resource 
A) making sure everyone gets a fair chance to consume 
B) how much is consumed 
C) creating laws that will completely forbid consumption in order to preserve the environment 
D) creating positive externalities from consuming the common resource

Question 11

Assuming that everyone prefers to live in a society without poverty,what do we know about people who do not donate to private charity

Accepted Answer

A) They receive no external benefit from private antipoverty programs. 
B) They decrease the reliance of individuals on antipoverty programs. 
C) They free-ride on the generosity of others. 
D) They are most likely to be in favour of government-sponsored programs. 
A) They receive no external benefit from private antipoverty programs. 
B) They decrease the reliance of individuals on antipoverty programs. 
C) They free-ride on the generosity of others. 
D) They are most likely to be in favour of government-sponsored programs.

Question 12

What is an example of a club good

Accepted Answer

A) Internet service 
B) tornado sirens 
C) clothing 
D) the environment 
A) Internet service 
B) tornado sirens 
C) clothing 
D) the environment

Question 13

Which of these common resources is one of the least regulated today

Accepted Answer

A) national parks 
B) the ocean 
C) government land in the North 
D) the Great Lakes 
A) national parks 
B) the ocean 
C) government land in the North 
D) the Great Lakes

Question 14

Studies have determined that 100 workers are exposed to a hazardous chemical used in the production of diet soft drinks.The cost of imposing a regulation that would ban this chemical is $5 million.Each person saved by this regulation has a value equal to $5 million.If benefits are exactly equal to costs,what probability is used to assess the likelihood of a fatality from exposure to this chemical

Accepted Answer

A) 0.001 
B) 0.01 
C) 0.1 
D) 1.0 
A) 0.001 
B) 0.01 
C) 0.1 
D) 1.0

Question 15

Depending on congestion,national parks can be either a common resource or a public good.

Accepted Answer

A) True 
 B)False

Question 16

Suppose that installing an overhead pedestrian walkway would cost a college town $50,000.If the walkway is expected to reduce the risk of fatality by 2 percent and the cost of a human life was estimated at $5 million,what would the town do

Accepted Answer

A) The town would install the walkway because the estimated benefit is twice the cost. 
B) The town would install the walkway because the estimated benefit equals the cost. 
C) The town would not install the walkway since the cost is twice the estimated benefit. 
D) The town would install the walkway since the cost of even a single life is too great. 
A) The town would install the walkway because the estimated benefit is twice the cost. 
B) The town would install the walkway because the estimated benefit equals the cost. 
C) The town would not install the walkway since the cost is twice the estimated benefit. 
D) The town would install the walkway since the cost of even a single life is too great.

Question 17

Once it becomes obvious that a common resource is being overused,what happens

Accepted Answer

A) Market forces cause the use of the resource to shift to a sustainable level. 
B) Society voluntarily limits its use of the good. 
C) It continues to be overused because individuals have no incentive to reduce their use of the good. 
D) The good becomes a club good. 
A) Market forces cause the use of the resource to shift to a sustainable level. 
B) Society voluntarily limits its use of the good. 
C) It continues to be overused because individuals have no incentive to reduce their use of the good. 
D) The good becomes a club good.

Question 18

A town engineer comes to the town council with a proposal to build a traffic light at a certain intersection that currently has a stop sign.The benefit of the traffic light is increased safety: it will reduce the incidence of fatal traffic accidents by 50 percent per year.Which decision can be made regarding this project

Accepted Answer

A) The project should definitely be accepted. 
B) The decision to install the light is likely to require an evaluation of the trade-off between the worth of human life and the lost time waiting for the light to change signals. 
C) The full cost of the traffic light will be relatively small since it only includes the purchase and installation costs. 
D) The cost will invariably outweigh the benefit. 
A) The project should definitely be accepted. 
B) The decision to install the light is likely to require an evaluation of the trade-off between the worth of human life and the lost time waiting for the light to change signals. 
C) The full cost of the traffic light will be relatively small since it only includes the purchase and installation costs. 
D) The cost will invariably outweigh the benefit.

Question 19

Why do salmon populations face the threat of extinction while goldfish populations are in no such danger

Accepted Answer

Nobody owns the salmon while private ind

Question 20

Even economists who advocate small government agree that national defence is a good that the government should provide.

Accepted Answer

A) True 
 B)False

What results when a free-rider problem exists

What do advocates of antipoverty programs believe about fighting poverty

Based on "The Dismal Education" by Yoram Bauman,what is the main reason that students majoring in economics tend to contribute less to public goods than other students

What is knowledge an example of

Suppose that the cost of installing an overhead pedestrian walkway in a college town is $50,000.If the walkway is expected to reduce the risk of fatality by 0.5 percent and the cost of a human life is estimated at $5 million,what would the town do

Why is basic research a public good

When one person uses a common resource,which of the following outcomes will most likely occur

What are common resource goods

Once a common resource is available for consumption,what do policymakers need to be concerned with

Assuming that everyone prefers to live in a society without poverty,what do we know about people who do not donate to private charity

What is an example of a club good

Which of these common resources is one of the least regulated today

Depending on congestion,national parks can be either a common resource or a public good.

Suppose that installing an overhead pedestrian walkway would cost a college town $50,000.If the walkway is expected to reduce the risk of fatality by 2 percent and the cost of a human life was estimated at $5 million,what would the town do

Once it becomes obvious that a common resource is being overused,what happens

Why do salmon populations face the threat of extinction while goldfish populations are in no such danger

Even economists who advocate small government agree that national defence is a good that the government should provide.

Ten Principles of 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

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Filters

Exam 11: Public Goods and Common Resources

What results when a free-rider problem exists

What do advocates of antipoverty programs believe about fighting poverty

Based on "The Dismal Education" by Yoram Bauman,what is the main reason that students majoring in economics tend to contribute less to public goods than other students

What is knowledge an example of

Suppose that the cost of installing an overhead pedestrian walkway in a college town is $50,000.If the walkway is expected to reduce the risk of fatality by 0.5 percent and the cost of a human life is estimated at $5 million,what would the town do

Why is basic research a public good

When one person uses a common resource,which of the following outcomes will most likely occur

What are common resource goods

Once a common resource is available for consumption,what do policymakers need to be concerned with

Assuming that everyone prefers to live in a society without poverty,what do we know about people who do not donate to private charity

What is an example of a club good

Which of these common resources is one of the least regulated today

Depending on congestion,national parks can be either a common resource or a public good.

Suppose that installing an overhead pedestrian walkway would cost a college town $50,000.If the walkway is expected to reduce the risk of fatality by 2 percent and the cost of a human life was estimated at $5 million,what would the town do

Once it becomes obvious that a common resource is being overused,what happens

Why do salmon populations face the threat of extinction while goldfish populations are in no such danger

Even economists who advocate small government agree that national defence is a good that the government should provide.

Ten Principles of 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

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Filters