Question 1

What is public choice economics?

Accepted Answer

Public choice economics is a field in economics that explores how governments actually operate.

Question 2

In a democracy,the median voter will tend to determine the quantities and types of public goods produced.

Accepted Answer

A) True 
 B)False  True

Question 3

The free-rider problem arises

Accepted Answer

A)  when people feel their contribution is so small relative to the total amount needed that it won't make a difference whether they contribute or not. 
B)  when people realize they will still receive the benefits of a good whether they pay for it or not. 
C)  whenever the government produces a good or service. 
D)  whenever there is a surplus of the product in the market. 
A)  when people feel their contribution is so small relative to the total amount needed that it won't make a difference whether they contribute or not. 
B)  when people realize they will still receive the benefits of a good whether they pay for it or not. 
C)  whenever the government produces a good or service. 
D)  whenever there is a surplus of the product in the market. B

Question 4

Education generates external benefits.A free market with no government intervention will produce

Accepted Answer

A)  an efficient level of education. 
B)  more than the efficient level of education. 
C)  less than the efficient level of education. 
D)  zero units of education. 
A)  an efficient level of education. 
B)  more than the efficient level of education. 
C)  less than the efficient level of education. 
D)  zero units of education.

Question 5

Explain the free-rider problem.

Accepted Answer

The free-rider problem occurs

Question 6

What is the median-voter rule?

Accepted Answer

The median-voter rule suggests

Question 7

A good is nonrival in consumption when it

Accepted Answer

A)  has either positive or negative external costs. 
B)  is priced at its marginal cost. 
C)  can be enjoyed by one person without that interfering with another's consumption. 
D)  is nonexcludable. 
A)  has either positive or negative external costs. 
B)  is priced at its marginal cost. 
C)  can be enjoyed by one person without that interfering with another's consumption. 
D)  is nonexcludable.

Question 8

What defines a situation where a person consumes a good without having to pay for it?

Accepted Answer

A)  the rival problem 
B)  the rival in consumption problem 
C)  the free-rider problem 
D)  the nonrival in consumption problem 
A)  the rival problem 
B)  the rival in consumption problem 
C)  the free-rider problem 
D)  the nonrival in consumption problem

Question 9

A group of volunteers from a top corporation participate in a volunteer program to rebuild a local playground.Among the 20 people that show up to help rebuild the playground,there are two individuals that just talk to each other and,unlike the rest of the people,do not do any work.At the end of the day,the entire group takes credit for the renovated project.How do you best describe this situation with the volunteer program to rebuild a local playground?

Accepted Answer

A)  The incentive to help others is high. 
B)  The two workers were free riding on the hard work of the others in the group who did work. 
C)  The two individuals impose an external cost on other members of the group. 
D)  none of the above 
A)  The incentive to help others is high. 
B)  The two workers were free riding on the hard work of the others in the group who did work. 
C)  The two individuals impose an external cost on other members of the group. 
D)  none of the above

Question 10

According to the self-interest theory of government,limitations on taxes and spending accounts are

Accepted Answer

A)  inessential precautions against politicians who focus on selfish behavior. 
B)  necessary safeguards against politicians who benefit from larger budgets. 
C)  the way all citizens can reap rewards from small interest groups. 
D)  the only way to balance the government's budget. 
A)  inessential precautions against politicians who focus on selfish behavior. 
B)  necessary safeguards against politicians who benefit from larger budgets. 
C)  the way all citizens can reap rewards from small interest groups. 
D)  the only way to balance the government's budget.

Question 11

The median voter group is

Accepted Answer

A)  a special interest group. 
B)  a group of voters who express their opinions in television and radio advertisements. 
C)  the large group of voters in the middle of the political spectrum. 
D)  all of the above 
A)  a special interest group. 
B)  a group of voters who express their opinions in television and radio advertisements. 
C)  the large group of voters in the middle of the political spectrum. 
D)  all of the above

Question 12

Recall the Application about labor agreements and salaries in the NBA to answer the following question(s).
-Recall the Application.Who benefited from the 1997 salary-cap agreement?

Accepted Answer

A)  the players who had salaries higher than the median salary 
B)  the players who had salaries below and closest to the median salary 
C)  the voters who were part of the board and were paying the high salaries to all the players 
D)  No one benefited from the agreement. 
A)  the players who had salaries higher than the median salary 
B)  the players who had salaries below and closest to the median salary 
C)  the voters who were part of the board and were paying the high salaries to all the players 
D)  No one benefited from the agreement.

Question 13

Goods that are nonrival in consumption and that have benefits that are nonexcludable are

Accepted Answer

A)  private goods. 
B)  neighbor effects. 
C)  public goods. 
D)  none of the above 
A)  private goods. 
B)  neighbor effects. 
C)  public goods. 
D)  none of the above

Question 14

The free-rider problem is a problem intrinsic to public goods; the good or service is usually so costly that its provision generally does not depend on whether or not any single person pays.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following statements about education is true?

Accepted Answer

A)  Education is a private good with external benefits like improved civic responsibilities. 
B)  Education is a public good and improves workplace performance. 
C)  Education is a public good that decreases government activities. 
D)  Education is a private good that only benefits the student. 
A)  Education is a private good with external benefits like improved civic responsibilities. 
B)  Education is a public good and improves workplace performance. 
C)  Education is a public good that decreases government activities. 
D)  Education is a private good that only benefits the student.

Question 16

Suppose it is that time of the year for the National Public radio station to invite every listener to pledge and support the station.Donna is a daily listener and decides to wait for others to contribute and support the station.Meanwhile,she continues to get the benefit of public broadcasting.This is an example of the

Accepted Answer

A)  public good problem. 
B)  free-rider problem. 
C)  rival in consumption problem. 
D)  drop-in-the-bucket problem. 
A)  public good problem. 
B)  free-rider problem. 
C)  rival in consumption problem. 
D)  drop-in-the-bucket problem.

Question 17

The median-voter rule suggests that

Accepted Answer

A)  politicians try to fool all of the voters all of the time. 
B)  politicians decide how to vote on an issue by looking at how other politicians will vote. 
C)  politicians often choose a position that reflects the preferences of the median voter. 
D)  politicians try to ensure that the services provided by the government are distributed equally across voters. 
A)  politicians try to fool all of the voters all of the time. 
B)  politicians decide how to vote on an issue by looking at how other politicians will vote. 
C)  politicians often choose a position that reflects the preferences of the median voter. 
D)  politicians try to ensure that the services provided by the government are distributed equally across voters.

Question 18

Sirens located around a town to warn citizens of the approach of a tornado are an example of

Accepted Answer

A)  an external cost. 
B)  a private good. 
C)  a common resource. 
D)  a public good. 
A)  an external cost. 
B)  a private good. 
C)  a common resource. 
D)  a public good.

Question 19

List and explain some of the external benefits generated by education.

Accepted Answer

The workplace is improved and

Question 20

Which of the following contains most of the characteristics of a public good?

Accepted Answer

A)  education 
B)  trash collection 
C)  public transportation 
D)  fireworks shows 
A)  education 
B)  trash collection 
C)  public transportation 
D)  fireworks shows

What is public choice economics?

In a democracy,the median voter will tend to determine the quantities and types of public goods produced.

The free-rider problem arises

Education generates external benefits.A free market with no government intervention will produce

Explain the free-rider problem.

What is the median-voter rule?

A good is nonrival in consumption when it

What defines a situation where a person consumes a good without having to pay for it?

According to the self-interest theory of government,limitations on taxes and spending accounts are

The median voter group is

Recall the Application about labor agreements and salaries in the NBA to answer the following question(s). -Recall the Application.Who benefited from the 1997 salary-cap agreement?

Goods that are nonrival in consumption and that have benefits that are nonexcludable are

The free-rider problem is a problem intrinsic to public goods; the good or service is usually so costly that its provision generally does not depend on whether or not any single person pays.

Which of the following statements about education is true?

The median-voter rule suggests that

Sirens located around a town to warn citizens of the approach of a tornado are an example of

List and explain some of the external benefits generated by education.

Which of the following contains most of the characteristics of a public good?

Introduction: What Is Economics

The Key Principles of Economics

Exchange and Markets

Demand,supply,and Market Equilibrium

Elasticity: a Measure of Responsiveness

Market Efficiency and Government Intervention

Consumer Choice: Utility Theory and Insights From Neuroscience

Production Technology and Cost

Perfect Competition

Monopoly and Price Discrimination

Market Entry and Monopolistic Competition

Oligopoly and Strategic Behavior

Controlling Market Power: Antitrust and Regulation

Imperfect Information: Adverse Selection and Moral Hazard

External Costs and Environmental Policy

The Labor Market and the Distribution of Income

International Trade and Public Policy

Filters

Exam 15: Public Goods and Public Choice

What is public choice economics?

In a democracy,the median voter will tend to determine the quantities and types of public goods produced.

The free-rider problem arises

Education generates external benefits.A free market with no government intervention will produce

Explain the free-rider problem.

What is the median-voter rule?

A good is nonrival in consumption when it

What defines a situation where a person consumes a good without having to pay for it?

According to the self-interest theory of government,limitations on taxes and spending accounts are

The median voter group is

Recall the Application about labor agreements and salaries in the NBA to answer the following question(s). -Recall the Application.Who benefited from the 1997 salary-cap agreement?

Goods that are nonrival in consumption and that have benefits that are nonexcludable are

The free-rider problem is a problem intrinsic to public goods; the good or service is usually so costly that its provision generally does not depend on whether or not any single person pays.

Which of the following statements about education is true?

The median-voter rule suggests that

Sirens located around a town to warn citizens of the approach of a tornado are an example of

List and explain some of the external benefits generated by education.

Which of the following contains most of the characteristics of a public good?

Introduction: What Is Economics

The Key Principles of Economics

Exchange and Markets

Demand,supply,and Market Equilibrium

Elasticity: a Measure of Responsiveness

Market Efficiency and Government Intervention

Consumer Choice: Utility Theory and Insights From Neuroscience

Production Technology and Cost

Perfect Competition

Monopoly and Price Discrimination

Market Entry and Monopolistic Competition

Oligopoly and Strategic Behavior

Controlling Market Power: Antitrust and Regulation

Imperfect Information: Adverse Selection and Moral Hazard

External Costs and Environmental Policy

The Labor Market and the Distribution of Income

International Trade and Public Policy

Filters