Question 1

Why does the commercial value of ivory threaten the elephant, while the commercial value of beef protects the cow?

Accepted Answer

Elephants are a common resource, whereas

Question 2

Because it is

Accepted Answer

A)  neither excludable nor rival in consumption, a tornado siren is a common resource. 
B)  neither excludable nor rival in consumption, a tornado siren is a public good. 
C)  excludable but not rival in consumption, a tornado siren is produced by a natural monopoly. 
D)  rival in consumption but not excludable, a tornado siren is a common resource. 
A)  neither excludable nor rival in consumption, a tornado siren is a common resource. 
B)  neither excludable nor rival in consumption, a tornado siren is a public good. 
C)  excludable but not rival in consumption, a tornado siren is produced by a natural monopoly. 
D)  rival in consumption but not excludable, a tornado siren is a common resource.

Question 3

Which two types of goods are rival in consumption?

Accepted Answer

Private goods and co

Question 4

A sidewalk runs across Jermichael's front yard near the street. By law, anyone has the right to use the sidewalk. When Jermichael shovels the sidewalk after a heavy snowstorm,

Accepted Answer

A)  he is providing a good that is excludable. 
B)  he is a free rider. 
C)  those who walk on the sidewalk are using a club good. 
D)  he is providing a good that is not rival and not excludable. 
A)  he is providing a good that is excludable. 
B)  he is a free rider. 
C)  those who walk on the sidewalk are using a club good. 
D)  he is providing a good that is not rival and not excludable.

Question 5

Table 11-2
Consider a small town with only three families, the Greene family, the Brown family, and the Black family. The town does not currently have any streetlights so it is very dark at night. The three families are considering putting in streetlights on Main Street and are trying to determine how many lights to install. The table below shows each family's willingness to pay for each streetlight.  
-Refer to Table 11-2. Suppose the cost to install each streetlight is $900 and the families have agreed to split the cost of installing the streetlights equally. If the residents choose to install the number of streetlights that will maximize total surplus from the streetlights, how much total surplus will the Greene family receive?

Accepted Answer

A)  -$40 
B)  $0 
C)  $40 
D)  $60 
A)  -$40 
B)  $0 
C)  $40 
D)  $60

Question 6

When goods are available free of charge, the market forces that normally allocate resources in our economy are absent.

Accepted Answer

A) True 
 B)False

Question 7

Figure 11-1
Rival in Consumption?
Yes No
Excludable? S1U1P1YesS1S1P0     No
-Refer to Figure 11-1. Emma's use of good x does not affect anyone else's use of good x. Neither Emma nor anyone else can be prevented from using the good. Good x is an example of the type of good that belongs in

Accepted Answer

A)  Box A, which represents private goods. 
B)  Box B, which represents common resources. 
C)  Box C, which represents common resources. 
D)  Box D, which represents public goods. 
A)  Box A, which represents private goods. 
B)  Box B, which represents common resources. 
C)  Box C, which represents common resources. 
D)  Box D, which represents public goods.

Question 8

In what way do public goods give rise to positive externalities?

Accepted Answer

When one person provides a pub

Question 9

Recall the four types of goods. Are national defense and a patented invention the same type of good? Briefly explain.

Accepted Answer

No. National defense

Question 10

Table 11-2
Consider a small town with only three families, the Greene family, the Brown family, and the Black family. The town does not currently have any streetlights so it is very dark at night. The three families are considering putting in streetlights on Main Street and are trying to determine how many lights to install. The table below shows each family's willingness to pay for each streetlight.  
-Refer to Table 11-2. Suppose the cost to install each streetlight is $900. How many streetlights should the town install to maximize total surplus from the streetlights?

Accepted Answer

A)  1 streetlight 
B)  2 streetlights 
C)  3 streetlights 
D)  4 streetlights 
A)  1 streetlight 
B)  2 streetlights 
C)  3 streetlights 
D)  4 streetlights

Question 11

If the use of a common resource is not regulated,

Accepted Answer

A)  no one can enjoy it. 
B)  it will tend to be underused. 
C)  property rights will be clearly defined. 
D)  it will be overused. 
A)  no one can enjoy it. 
B)  it will tend to be underused. 
C)  property rights will be clearly defined. 
D)  it will be overused.

Question 12

National Public Radio would be considered a club good.

Accepted Answer

A) True 
 B)False

Question 13

In which of the following examples are property rights not well established?

Accepted Answer

A)  Carmen smokes a cigarette outside the door to her office building. 
B)  Carlita stocks shelves in a grocery store. 
C)  Cameron watches a movie in his home theater room. 
D)  Cathy docks her boat at her lake house. 
A)  Carmen smokes a cigarette outside the door to her office building. 
B)  Carlita stocks shelves in a grocery store. 
C)  Cameron watches a movie in his home theater room. 
D)  Cathy docks her boat at her lake house.

Exam 11: Public Goods and Common Resources

Why does the commercial value of ivory threaten the elephant, while the commercial value of beef protects the cow?

Because it is

Which two types of goods are rival in consumption?

A sidewalk runs across Jermichael's front yard near the street. By law, anyone has the right to use the sidewalk. When Jermichael shovels the sidewalk after a heavy snowstorm,

When goods are available free of charge, the market forces that normally allocate resources in our economy are absent.

Figure 11-1 Rival in Consumption? Yes No Excludable? Yes No -Refer to Figure 11-1. Emma's use of good x does not affect anyone else's use of good x. Neither Emma nor anyone else can be prevented from using the good. Good x is an example of the type of good that belongs in

In what way do public goods give rise to positive externalities?

Recall the four types of goods. Are national defense and a patented invention the same type of good? Briefly explain.

If the use of a common resource is not regulated,

National Public Radio would be considered a club good.

In which of the following examples are property rights not well established?

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

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

The Basic Tools of Finance

Unemployment

The Monetary System

Money Growth and Inflation

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

Six Debates Over Macroeconomic Policy

Filters

Figure 11-1 Rival in Consumption? Yes No Excludable? ^Yes No -Refer to Figure 11-1. Emma's use of good x does not affect anyone else's use of good x. Neither Emma nor anyone else can be prevented from using the good. Good x is an example of the type of good that belongs in