Question 1

When something of value has no price attached to it,

Accepted Answer

A)  externalities will be present.
B)  production of the product has no cost.
C)  government should not intervene to produce the product.
D)  private companies will eventually produce the product, and the good will no longer be free.E) A) and B)
F) A) and C)

Question 2

The sign on a church in your neighborhood reads "All are welcome at Sunday Service." Because the church has limited seating and is usually full, the Sunday Service is

Accepted Answer

A)  a private good.
B)  a public good.
C)  a club good.
D)  a common resource.E) A) and B)
F) A) and C)

Question 3

Identify the externality that arises when basic research leads to new general knowledge. Is the externality positive or negative?

Accepted Answer

Other people, besides the pers...

Question 4

Highway engineers want to improve a dangerous stretch of highway. They expect that it will reduce the risk of someone dying in an accident from 5.3 percent to 2.1 percent over the life of the highway. If a human life is worth $10 million, then the project is worth doing as long as it does not cost more than

Accepted Answer

A)  $53,000.
B)  $210,000.
C)  $320,000.
D)  $2.1 million.E) A) and D)
F) None of the above

Question 5

Three business people meet for lunch at an Indian restaurant. They decide that each person will order an item off the menu, and they will share all dishes. They will split the cost of the final bill evenly among each of the people at the table. When the food is delivered to the table, each person faces incentives similar to the

Accepted Answer

A)  consumption of a common resource good.
B)  production of a public good.
C)  consumption of a club good.
D)  production of a private good.E) A) and B)
F) All of the above

Question 6

Figure 11-1 
-Refer to Figure 11-1. The box labeled B represents what type of good?

Accepted Answer

Box B repr...

Question 7

A pizza is

Accepted Answer

A)  excludable and rival in consumption.
B)  excludable and nonrival in consumption.
C)  nonexcludable and rival in consumption.
D)  nonexcludable and nonrival in consumption.E) A) and B)
F) B) and C)

Question 8

The Tragedy of the Commons describes

Accepted Answer

A)  government regulation that is necessary to combat externalities.
B)  overuse of a common resource relative to its economically efficient use.
C)  the nonrivalry feature of a common resource.
D)  an effective cost-benefit analysis.E) C) and D)
F) All of the above

Question 9

Suppose the cost to erect a tornado siren in a small town is $15,000. In addition, suppose the value of a human life is $10 million. By what percentage would the siren need to reduce the risk of a fatality for the benefits of the siren to exceed the costs of the siren?

Accepted Answer

A)  By at least 0.015 percentage points.
B)  By at least 0.15 percentage points.
C)  By at least 1.5 percentage points.
D)  By at least 5 percentage points.E) None of the above
F) All of the above

Question 10

Figure 11-1 
-Refer to Figure 11-1. Which of the following statements is correct?

Accepted Answer

A)  A congested toll road is an example of the type of good represented by Box B.
B)  An uncongested toll road is an example of the type of good represented by Box D.
C)  A congested nontoll road is an example of the type of good represented by Box C.
D)  An uncongested nontoll road is an example of the type of good represented by Box A.E) A) and B)
F) None of the above

Question 11

In a certain city, the government is considering acquiring some land and turning it into a park (without any fences or gates) . In an attempt to determine the extent to which residents of the city would value the park, residents are asked to fill out a questionnaire. Which of the following is correct?

Accepted Answer

A)  On the questionnaire, some residents are likely to exaggerate the value they associate with the park.
B)  On the questionnaire, some residents are likely to exaggerate the costs they associate with the park.
C)  The use of such a questionnaire in cost-benefit analysis is likely to produce only rough approximations of residents' perceptions of the costs and benefits of a park.
D)  All of the above are correct.E) A) and B)
F) A) and C)

Question 12

Table 11-6
Consider the city of Widgetapolis with only four residents, John, James, Mary, and Lydia. The four residents are trying to determine how many hours to spend in cleaning up the public lake. The table below shows each resident's willingness to pay for each hour of cleaning.  ​
​
-​Refer to Table 11-6. Suppose the cost to clean the lake is $8 per hour and that the residents have agreed to split the cost of cleaning the lake equally. The number of cleaning hours that maximizes total surplus of Widgetapolis is 7 hours.

Accepted Answer

A) True 
 B)False

Question 13

Roads can be considered either public goods or common resources, depending on how congested they are.

Accepted Answer

A) True 
 B)False

Question 14

Table 11-3
This table describes the police protection demands for three equal sized groups of people in Safetyville. The second, third, and fourth columns show the number of person-hours of police protection per day that a group will demand for a given price (the first column) . th unit of police protection in Safetyville? A) $0 B) $6 C) $12 D) $18" class="answers-bank-image d-inline" rel="preload" >
-Refer to Table 11-3. What is the value of the 99th unit of police protection in Safetyville?

Accepted Answer

A)  $0
B)  $6
C)  $12
D)  $18E) None of the above
F) All of the above

Question 15

If the government decides to build a new highway, the first step would be to conduct a study to determine the value of the project. The study is called a

Accepted Answer

A)  budget analysis.
B)  project analysis.
C)  reimbursement analysis.
D)  cost-benefit analysis.E) A) and B)
F) A) and C)

Question 16

The ocean remains one of the largest unregulated resources for each of the following reasons except

Accepted Answer

A)  many countries have access to the ocean.
B)  it is difficult to get international cooperation among countries that hold different values.
C)  the oceans are so vast that enforcing any agreements would be difficult.
D)  All of the above are reasons the ocean remains one of the largest unregulated resources.E) A) and B)
F) A) and C)

Question 17

Seymour owns 3 acres of beautiful waterfront property on a large inland lake. In his will, Seymour donates the land to the state with the understanding that the land will be used as a state beach. Seymour wants an efficient way to prevent overcrowding at the beach, so he should require

Accepted Answer

A)  that all beach visitors pay the same entry fee regardless of the day of the week or time of the year.
B)  that the beach limit the number of visitors to 500 per day, without an entry fee.
C)  an entry fee be charged on summer weekend days when many people tend to visit the beach.
D)  that only local residents be admitted to the beach.E) A) and B)
F) A) and C)

Question 18

Because it is

Accepted Answer

A)  excludable but not rival in consumption, a sweatshirt is a club good.
B)  rival in consumption but not excludable, a sweatshirt is a club good.
C)  both excludable and rival in consumption, a sweatshirt is a private good.
D)  neither excludable nor rival in consumption, a sweatshirt is a public good.E) C) and D)
F) None of the above

Question 19

In the Tragedy of the Commons parable, if the medieval townspeople had foreseen the tragedy, then they could have dealt with the problem in much the same way that modern society deals with

Accepted Answer

A)  fire protection.
B)  poverty.
C)  pollution.
D)  national defense.E) A) and B)
F) A) and C)

Question 20

A local park filled with picnickers is

Accepted Answer

A)  excludable and rival in consumption.
B)  excludable and not rival in consumption.
C)  not excludable and rival in consumption.
D)  not excludable and not rival in consumption.E) B) and C)
F) B) and D)

Exam 11: Public Goods and Common Resources

Correct Answer
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Identify the externality that arises when basic research leads to new general knowledge. Is the externality positive or negative?

Correct Answer
verified
Other people, besides the pers...
View Answer

In the Tragedy of the Commons parable, if the medieval townspeople had foreseen the tragedy, then they could have dealt with the problem in much the same way that modern society deals with

Correct Answer
verified

Correct Answer
verified

A local park filled with picnickers is

Correct Answer
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Suppose the cost to erect a tornado siren in a small town is $15,000. In addition, suppose the value of a human life is $10 million. By what percentage would the siren need to reduce the risk of a fatality for the benefits of the siren to exceed the costs of the siren?

Correct Answer
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Figure 11-1 -Refer to Figure 11-1. Which of the following statements is correct?

Correct Answer
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Seymour owns 3 acres of beautiful waterfront property on a large inland lake. In his will, Seymour donates the land to the state with the understanding that the land will be used as a state beach. Seymour wants an efficient way to prevent overcrowding at the beach, so he should require

Correct Answer
verified

When something of value has no price attached to it,

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

If the government decides to build a new highway, the first step would be to conduct a study to determine the value of the project. The study is called a

Correct Answer
verified

Correct Answer
verified

The sign on a church in your neighborhood reads "All are welcome at Sunday Service." Because the church has limited seating and is usually full, the Sunday Service is

Correct Answer
verified

Figure 11-1 -Refer to Figure 11-1. The box labeled B represents what type of good?

Correct Answer
verified
Box B repr...
View Answer

Roads can be considered either public goods or common resources, depending on how congested they are.

Correct Answer
verified

The ocean remains one of the largest unregulated resources for each of the following reasons except

Correct Answer
verified

A pizza is

Correct Answer
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Because it is

Correct Answer
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The Tragedy of the Commons describes

Correct Answer
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Exam 11: Public Goods and Common Resources

Correct AnswerverifiedShow Answer

Identify the externality that arises when basic research leads to new general knowledge. Is the externality positive or negative?

Correct AnswerverifiedOther people, besides the pers...View AnswerShow Answer

In the Tragedy of the Commons parable, if the medieval townspeople had foreseen the tragedy, then they could have dealt with the problem in much the same way that modern society deals with

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A local park filled with picnickers is

Correct AnswerverifiedShow Answer

Suppose the cost to erect a tornado siren in a small town is $15,000. In addition, suppose the value of a human life is $10 million. By what percentage would the siren need to reduce the risk of a fatality for the benefits of the siren to exceed the costs of the siren?

Correct AnswerverifiedShow Answer

Figure 11-1 -Refer to Figure 11-1. Which of the following statements is correct?

Correct AnswerverifiedShow Answer

Seymour owns 3 acres of beautiful waterfront property on a large inland lake. In his will, Seymour donates the land to the state with the understanding that the land will be used as a state beach. Seymour wants an efficient way to prevent overcrowding at the beach, so he should require

Correct AnswerverifiedShow Answer

When something of value has no price attached to it,

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

If the government decides to build a new highway, the first step would be to conduct a study to determine the value of the project. The study is called a

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The sign on a church in your neighborhood reads "All are welcome at Sunday Service." Because the church has limited seating and is usually full, the Sunday Service is

Correct AnswerverifiedShow Answer

Figure 11-1 -Refer to Figure 11-1. The box labeled B represents what type of good?

Correct AnswerverifiedBox B repr...View AnswerShow Answer

Roads can be considered either public goods or common resources, depending on how congested they are.

Correct AnswerverifiedShow Answer

The ocean remains one of the largest unregulated resources for each of the following reasons except

Correct AnswerverifiedShow Answer

A pizza is

Correct AnswerverifiedShow Answer

Because it is

Correct AnswerverifiedShow Answer

The Tragedy of the Commons describes

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
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Other people, besides the pers...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Box B repr...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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