Deck 10: Sustainability and the Natural Environment

Question 1

Select the statement that does not express a good reason for preserving biological diversity among both plant and animal species.

A)Lost diversity among crops makes food production more prone to disease and weather-related failures.
B)Plant diversity holds great promise for research into medicine production.
C)Plant diversity holds great promise for research into food production.
D)Biodiversity contributes to healthier ecosystems.
E)All of the answers are correct.
F)None of the answers are correct.

Answer 1

None of the answers are correct.

Question 2

Select the statement that does not challenge the narrow view of the economic model of corporate social responsibility.

A)Business's only responsibility is to maximize profit within the law, and in so doing, fulfills its role within a market system, which, in turn, serves the greater overall social good.
B)The "costs" of pollution are typically borne by parties external to the economic exchange, so free market exchanges cannot guarantee optimal results.
C)Important ethical and policy questions can be missed if policy decisions are left solely to the outcome of individual decisions.
D)Public goods such as a stable climate, clean air, and ocean fisheries have no established market price.

Answer 2

Business's only responsibility is to maximize profit within the law, and in so doing, fulfills its role within a market system, which, in turn, serves the greater overall social good.

Question 3

Identify the statement that challenges the perspective that ad hoc attempts to repair market failures are environmentally inadequate.

A)Markets can work to prevent harm only through information supplied by the existence of market failures.
B)We learn about market failures and thereby prevent harms in the future only by sacrificing the first generation as a means for gaining this information.
C)Business has wider environmental responsibilities than those required under a narrow free market approach.
D)External costs should be internalized, and property rights should be assigned to unowned goods such as wild species.

Answer 3

External costs should be internalized, and property rights should be assigned to unowned goods such as wild species.

Question 4

Before the enactment of the environmental protection laws of the 1970s, which of the following was the generally accepted approach in the United States to business's responsibility?

A)Only individuals who could prove that they had been harmed by pollution could raise legal challenges to air and water pollution.
B)As long as business responded to the market and obeyed the law, it met its environmental responsibilities.
C)Laws established minimum standards to ensure air and water quality and species preservation.
D)Absent any proof of negligence, public policy lets the market decide environmental policy.
E)A and D.
F)B and C.

Question 5

Select the statement that does not identify a problem that suggests that the regulatory approach will prove inadequate over the long term.

A)It underestimates the ability of business to influence consumer choice.
B)It assumes that business fulfills its environmental responsibility when it responds to the environmental demands of consumers.
C)It underestimates the influence that business can have in establishing the law.
D)It assumes that economic growth is environmentally and ethically benign.

Question 6

Choose the statement that defenders of the circular flow model, which explains the nature of economic transactions in terms of a flow of resources from businesses to households, would agree with.

A)The services that resources yield can be provided in many ways by substituting different factors of production and are, therefore, infinite.
B)The possibility that the economy can grow indefinitely to keep up with significant population growth is ignored by this model.
C)If resources are moved through the classical model of a productive system at a rate that outpaces the productive capacity of the earth or the earth's capacity to absorb wastes and by-products of the system, the entire classical model will prove unstable.
D)Many resources like clean air, drinkable water, fertile soil, and food, under the circular flow model, cannot be replaced by the remaining factors of production.

Question 7

Identify the statement that does not meet Natural Capitalism's principles for the redesign of business to meet its environmental responsibilities.

A)To serve the needs of the poorest 75 percent of the world's population, ecoefficient business practices focus on ways of increasing efficiency and, therefore, decreasing resource use by a factor of 5 to 10.
B)To serve the needs of the poorest 75 percent of the world's population, the standard growth model would increase economic growth by a factor of 5 to 10.
C)The principle of biomimicry attempts to eliminate by-products once lost as waste and pollution and reintegrate them into the production process or return them as a benign or beneficial product to the biosphere.
D)Models of business as a producer of goods should be replaced with a model of business as a provider of services.

Question 8

Which of the following statements is true of market failures?

A)Market failures bolster the ability of economic markets to achieve a sound environmental policy.
B)Ad hoc attempts to repair market failures have proved to be environmentally adequate.
C)Market failures occur when abundant markets exist to create a price for important social goods.
D)Sacrificing the first generation of public goods as a means for gaining information on market failures is an ill-advised strategy.

Question 9

Identify a true statement about environmental regulations.

A)Currently, the primary legal avenue open for addressing environmental concerns in business is tort law.
B)Environmental laws enacted during the 1970s shifted the burden of proof from those who cause the harm to those threatened with harm.
C)The current approach to environmental regulations underestimates the influence that business can have in establishing the law.
D)National environmental regulations are sufficient to address international environmental challenges.

Question 10

In one area of emerging environmental policy consensus, the real ethical issue in the debate over the use of nonhuman natural objects as resources is not that we use them, but which objects we use, how, what for, and the rate at which we use them.

Question 11

Defenders of the narrow view of corporate social responsibility argue that internalizing external costs and assigning property rights to unowned goods, such as wild species, are appropriate responses to market failures.

Question 12

Market solutions to environmental pollution fallaciously presume that what is good and rational for a collection of individuals is necessarily good and rational for a society. As a result, important ethical and policy questions can be missed and that can lead to serious environmental harm. Under the market model, for example, restricting sales of sports utility vehicles (SUVs) and treating them as trucks with higher gas mileage standards or increasing taxes on gasoline would never be considered.

Question 13

Although beliefs are objective and subject to rational evaluation, there is no reason not to judge the validity of a person's belief by a person's willingness to pay for it. Therefore, economic analysis legitimately includes beliefs in addressing environmental policy.

Question 14

Markets can work to prevent harm only through information supplied by the existence of market successes.

Question 15

If the productive activities used in the classical model of economics continue, the entire model will prove unstable because these activities may move resources through the system at a rate that outgrows the productive capacity of the earth or the earth's capacity to absorb their wastes and by-products.

Question 16

There are no conditions that will allow the biosphere to produce resources and absorb wastes indefinitely.

Question 17

In the current decade, the idea of sustainability has become the primary model for understanding business's environmental responsibilities.