Question 1

By the year 2100,global warming may lead to

Accepted Answer

A) shifts in world rain patterns. 
B) disruption of agriculture. 
C) expanded deserts. 
D) coastal inundation. 
E) all of the above 
A) shifts in world rain patterns. 
B) disruption of agriculture. 
C) expanded deserts. 
D) coastal inundation. 
E) all of the above

Question 2

Dwindling resources encourage the development of substitute products.

Accepted Answer

A) True 
 B)False

Question 3

The production of smoke as a pollutant is a failure of the market system.

Accepted Answer

A) True 
 B)False

Question 4

If a firm that emits a form of pollution is also a monopolist,is the firm more likely to be allocatively efficient? Explain.

Accepted Answer

Yes.A monopolist maximizes profit by red

Question 5

Emissions permits allow polluters to pay for the right to pollute a specified amount.

Accepted Answer

A) True 
 B)False

Question 6

The external costs of alcohol consumption are related to,among other things,death and injury related to auto accidents caused by drunk drivers.These costs have been estimated to be about 47 cents per ounce of alcohol consumed.Taxes on alcohol amount to 23 cents per ounce.This suggests that alcohol consumption is (i)greater than the efficient or optimal amount; (ii)should be reduced to zero to eliminate the externality.

Accepted Answer

A) i and ii 
B) i not ii 
C) ii not i 
D) neither i nor ii 
A) i and ii 
B) i not ii 
C) ii not i 
D) neither i nor ii

Question 7

Discuss the role of individuals and governments in committing environmental damage.

Accepted Answer

Private individuals and government are m

Question 8

Direct controls work if

Accepted Answer

A) there is vigilance and enthusiasm in enforcement by the regulatory agency. 
B) speed and rigor are used in the court system in prosecuting cases. 
C) there are significant penalties imposed by the legal system. 
D) All of the above occur. 
A) there is vigilance and enthusiasm in enforcement by the regulatory agency. 
B) speed and rigor are used in the court system in prosecuting cases. 
C) there are significant penalties imposed by the legal system. 
D) All of the above occur.

Question 9

The "edifice complex" is based on the idea that bigger is better.

Accepted Answer

A) True 
 B)False

Question 10

Direct controls have a clear advantage when a total ban is necessary.

Accepted Answer

A) True 
 B)False

Question 11

The position of the supply curve in the market for garbage removal

Accepted Answer

A) is irrelevant since the cost is fixed. 
B) depends on the marginal cost of garbage removal. 
C) depends on the demand for garbage removal services. 
D) is unaffected by taxes levied per household amount of garbage. 
A) is irrelevant since the cost is fixed. 
B) depends on the marginal cost of garbage removal. 
C) depends on the demand for garbage removal services. 
D) is unaffected by taxes levied per household amount of garbage.

Question 12

Forecasts of an inevitable exhaustion of essential natural resources are "simply beside the point" because higher prices

Accepted Answer

A) reduce quantity demanded. 
B) stimulate supply. 
C) stimulate alternative technology. 
D) All of the above are true. 
A) reduce quantity demanded. 
B) stimulate supply. 
C) stimulate alternative technology. 
D) All of the above are true.

Question 13

Direct controls have a clear advantage where

Accepted Answer

A) an emission is so dangerous that it is prohibited altogether. 
B) a sudden change in circumstances calls for prompt and substantial change in conduct. 
C) effective and dependable metering devices have not been invented or are prohibitively costly to install and operate. 
D) All of the above create an advantage. 
A) an emission is so dangerous that it is prohibited altogether. 
B) a sudden change in circumstances calls for prompt and substantial change in conduct. 
C) effective and dependable metering devices have not been invented or are prohibitively costly to install and operate. 
D) All of the above create an advantage.

Question 14

One advantage about an emissions permit system is that

Accepted Answer

A) it creates a "license to pollute," sure to be popular with environmentalists. 
B) it reduces uncertainty about the quantity of pollution that will be emitted. 
C) it is a direct control system and avoids the inefficiencies of a market. 
D) permits can be handed out on the basis of need to protect firms from high costs. 
A) it creates a "license to pollute," sure to be popular with environmentalists. 
B) it reduces uncertainty about the quantity of pollution that will be emitted. 
C) it is a direct control system and avoids the inefficiencies of a market. 
D) permits can be handed out on the basis of need to protect firms from high costs.

Question 15

There has been a downward trend in the United States since 1980 in the ambient concentrations of

Accepted Answer

A) sulfur dioxide. 
B) carbon monoxide. 
C) lead. 
D) all of the above. 
A) sulfur dioxide. 
B) carbon monoxide. 
C) lead. 
D) all of the above.

Question 16

Voluntarism in recycling garbage

Accepted Answer

A) generally has not been successful. 
B) works only where there is surveillance. 
C) increases the cost of recycling waste. 
D) has worked best of all recycling program alternatives. 
A) generally has not been successful. 
B) works only where there is surveillance. 
C) increases the cost of recycling waste. 
D) has worked best of all recycling program alternatives.

Question 17

An advantage emission taxes and permits have over direct controls is that the former

Accepted Answer

A) work well even if pollution output cannot be accurately measured. 
B) can respond quickly to new information about the dangers of particular pollutants. 
C) make it in firms' interests to reduce pollution in the most efficient manner possible. 
D) reduce pollution to zero. 
A) work well even if pollution output cannot be accurately measured. 
B) can respond quickly to new information about the dangers of particular pollutants. 
C) make it in firms' interests to reduce pollution in the most efficient manner possible. 
D) reduce pollution to zero.

Question 18

Taking advantage of the built-in-loophole in emission taxes implies

Accepted Answer

A) opportunity to save on taxes by reducing emissions. 
B) opportunity to avoid taxes even without cutting emissions. 
C) opportunity to increase emission by paying more tax. 
D) opportunity to pay less by increasing emission. 
A) opportunity to save on taxes by reducing emissions. 
B) opportunity to avoid taxes even without cutting emissions. 
C) opportunity to increase emission by paying more tax. 
D) opportunity to pay less by increasing emission.

Question 19

The price elasticity of demand for an exhaustible natural resource tends to

Accepted Answer

A) fall over time because extraction costs rise over time. 
B) stay constant over time because the resource's price rises at a constant rate. 
C) rise over time because the resource's rising price stimulates conservation and the development of substitutes. 
D) rise over time because resource extraction tends to become more efficient over time. 
A) fall over time because extraction costs rise over time. 
B) stay constant over time because the resource's price rises at a constant rate. 
C) rise over time because the resource's rising price stimulates conservation and the development of substitutes. 
D) rise over time because resource extraction tends to become more efficient over time.

Question 20

The optimal level of pollution is achieved when the

Accepted Answer

A) marginal social benefits from decreased pollution are equal to its marginal social costs of reducing pollution. 
B) level of pollution is zero. 
C) pollution abatement exceeds the pollution level. 
D) benefits from further pollution abatement are zero. 
A) marginal social benefits from decreased pollution are equal to its marginal social costs of reducing pollution. 
B) level of pollution is zero. 
C) pollution abatement exceeds the pollution level. 
D) benefits from further pollution abatement are zero.

Exam 17: Externalities, the Environment, and Natural Resources

By the year 2100,global warming may lead to

Dwindling resources encourage the development of substitute products.

The production of smoke as a pollutant is a failure of the market system.

If a firm that emits a form of pollution is also a monopolist,is the firm more likely to be allocatively efficient? Explain.

Emissions permits allow polluters to pay for the right to pollute a specified amount.

Discuss the role of individuals and governments in committing environmental damage.

Direct controls work if

The "edifice complex" is based on the idea that bigger is better.

Direct controls have a clear advantage when a total ban is necessary.

The position of the supply curve in the market for garbage removal

Forecasts of an inevitable exhaustion of essential natural resources are "simply beside the point" because higher prices

Direct controls have a clear advantage where

One advantage about an emissions permit system is that

There has been a downward trend in the United States since 1980 in the ambient concentrations of

Voluntarism in recycling garbage

An advantage emission taxes and permits have over direct controls is that the former

Taking advantage of the built-in-loophole in emission taxes implies

The price elasticity of demand for an exhaustible natural resource tends to

The optimal level of pollution is achieved when the

What Is Economics

The Economy: Myth and Reality

The Fundamental Economic Problem: Scarcity and Choice

Supply and Demand: An Initial Look

Consumer Choice: Individual and Market Demand

Demand and Elasticity

Production,Inputs,and Cost: Building Blocks for Supply Analysis

Output,Price,and Profit: The Importance of Marginal Analysis

Securities: Business Finance,and the Economy: The Tail That Wags the Dog

The Firm and the Industry Under Perfect Competition

Monopoly

Between Competition and Monopoly

Limiting Market Power: Regulation and Antitrust

The Case for Free Markets I: the Price System

The Shortcomings of Free Markets

The Markets Prime Achievement: Innovation and Growth

Taxation and Resource Allocation

Pricing the Factors of Production

Labor and Entrepreneurship: The Human Inputs

Poverty, Inequality, and Discrimination

International Trade and Comparative Advantage

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