Question 1

Resources tend to be allocated inefficiently when goods

Accepted Answer

A)   are private goods.
B)   are rival in consumption and excludable.
C)   are available free of charge.
D)   are available only at very high prices.E) All of the above
F) A) and B)

Question 2

Depending on congestion, national parks can be either a common resource or a public good.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following goods is excludable but not rival in consumption?

Accepted Answer

A)   a congested toll road
B)   fire protection in a small town
C)   a tornado siren
D)   whales in the oceanE) All of the above
F) A) and D)

Question 4

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) A) and B)
F) None of the above

Question 5

Each of the following explains why cost-benefit analysis is difficult except

Accepted Answer

A)   there is no price with which to judge the value of a public good.
B)   surveys are often biased and unreliable.
C)   it is difficult to identify all factors that influence costs and benefits of public goods.
D)   government projects rarely have sufficient funding to complete them on time.E) All of the above
F) A) and C)

Question 6

Economists think that the best way to determine the value of a human life is to

Accepted Answer

A)   evaluate the value of a person's expected earnings in the labor market.
B)   evaluate the risks people are willing to take and what they would have to be paid to take them.
C)   determine a person's accumulated wealth at the time of death.
D)   do nothing; human life is priceless.E) A) and D)
F) B) and C)

Question 7

Is a congested nontoll road excludable? Is it rival in consumption? How do we classify a congested nontoll road in terms of the four types of goods?

Accepted Answer

A congested nontoll road is no...

Question 8

Scenario 11-2
Consider the following goods:
-fire-protection services provided by a fire department
-a beautiful mural on the outside wall of a fire station
-a firefighter's helmet
-Refer to Scenario 11-2. Which of these goods is the best example of a club good? Briefly explain.

Accepted Answer

Fire-protection services is th...

Question 9

A good that is rival in consumption and not excludable is called a

Accepted Answer

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

Question 10

In a cost-benefit analysis, the value of a human life is sometimes calculated on the basis of

Accepted Answer

A)   the risks that a person voluntarily exposes herself to in her job and/or recreational choices.
B)   the value of each individual's assets.
C)   the belief that human life is priceless.
D)   the amount of resources required to adequately sustain life.E) None of the above
F) All of the above

Question 11

What particular characteristic do public goods and common resources have in common?

Accepted Answer

Public goods and common resour...

Question 12

Which of the following would not be considered a private good?

Accepted Answer

A)   a pair of scissors
B)   a pair of shoes
C)   an SUV
D)   cable TV serviceE) A) and B)
F) A) and C)

Question 13

The commercial value of ivory is a threat to the elephant, but the commercial value of beef is a guardian of the cow. This is because

Accepted Answer

A)   the cow is raised in developed countries, while the elephant lives primarily in less-developed countries.
B)   cows are private goods, while elephants tend to roam freely without owners.
C)   cows and elephants are public goods, but ivory is nonrival.
D)   ivory is nonrival and nonexclusive, but beef is rival and exclusive.E) All of the above
F) None of the above

Question 14

On hot summer days, electricity-generating capacity is sometimes stretched to the limit. At these times, electric companies may ask people to voluntarily cut back on their use of electricity. An economist would suggest that

Accepted Answer

A)   every electric customer has an incentive to prevent the system from overloading, so this voluntary approach is the most efficient.
B)   it would be more efficient if the electric company raised its rates for electricity at peak times.
C)   it would be more efficient to have a lottery to decide who had to cut back their use of electricity at peak times.
D)   it would be more efficient to force everyone to cut their usage of electricity by the same amount.E) A) and C)
F) A) and D)

Question 15

Table 11-1
Consider the town of Springfield with only three residents, Sophia, Amber, and Cedric. The three residents are trying to determine how large, in acres, they should build the public park. The table below shows each resident's willingness to pay for each acre of the park. 
-Refer to Table 11-1. Suppose the cost to build the park is $24 per acre and that the residents have agreed to split the cost of building the park equally. To maximize his own surplus, how many acres would Cedric like Springfield to build?

Accepted Answer

A)   0 acres
B)   1 acre
C)   2 acres
D)   3 acresE) A) and B)
F) A) and C)

Question 16

Most goods in the economy are

Accepted Answer

A)   club goods.
B)   common resources.
C)   public goods.
D)   private goods.E) All of the above
F) A) and D)

Question 17

Table 11-5
A small island off the coast of Cape Cod contains two restaurants and two retail stores. Tourists need to take a ferry boat to reach the island, but with a recent slowdown in the economy, tourists are less willing to pay for the boat ride to visit the island. The owners of the restaurants and stores on the island - Restaurants 1 and 2, and Stores A and B - think that if tourists could ride the ferry for free, they would be happy to visit the island, eat and shop. The business owners are considering contributing to a pool of money that will be used to pay for roundtrip ferry service each day. The table represents their willingness to pay, that is, the maximum amount that each business owner is willing to contribute, per day, to pay for each ferry trip. 
-Refer to Table 11-5. Suppose the cost to run the ferry for each roundtrip is $750 per day and the 4 business owners have agreed to split the costs of the ferry trips equally. How many ferry trips would the owner of Restaurant 1 prefer to have?

Accepted Answer

A)   0
B)   1
C)   2
D)   3E) B) and C)
F) None of the above

Question 18

A free-rider problem exists for any good that is not

Accepted Answer

A)   rival in consumption.
B)   a private good.
C)   free.
D)   excludable.E) None of the above
F) C) and D)

Question 19

A cable television broadcast of a movie 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) A) and D)
F) B) and C)

Question 20

Figure 11-1
Rival in Consumption?
Yes No
Excludable? Yes Yes     No -Refer to Figure 11-1. Which of the following statements is correct? 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." class="answers-bank-image d-inline" rel="preload" > Yes     No -Refer to Figure 11-1. Which of the following statements is correct? 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." class="answers-bank-image d-inline" rel="preload" > No
-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) C) and D)
F) A) and D)

Exam 11: Public Goods and Common Resources

A good that is rival in consumption and not excludable is called a

Correct Answer
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Depending on congestion, national parks can be either a common resource or a public good.

Correct Answer
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Which of the following goods is excludable but not rival in consumption?

Correct Answer
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Figure 11-1 Rival in Consumption? Yes No Excludable? ^Yes No -Refer to Figure 11-1. Which of the following statements is correct?

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Because it is

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A free-rider problem exists for any good that is not

Correct Answer
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On hot summer days, electricity-generating capacity is sometimes stretched to the limit. At these times, electric companies may ask people to voluntarily cut back on their use of electricity. An economist would suggest that

Correct Answer
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A cable television broadcast of a movie is

Correct Answer
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Which of the following would not be considered a private good?

Correct Answer
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Economists think that the best way to determine the value of a human life is to

Correct Answer
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Resources tend to be allocated inefficiently when goods

Correct Answer
verified

In a cost-benefit analysis, the value of a human life is sometimes calculated on the basis of

Correct Answer
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Scenario 11-2 Consider the following goods: -fire-protection services provided by a fire department -a beautiful mural on the outside wall of a fire station -a firefighter's helmet -Refer to Scenario 11-2. Which of these goods is the best example of a club good? Briefly explain.

Correct Answer
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Fire-protection services is th...
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Each of the following explains why cost-benefit analysis is difficult except

Correct Answer
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What particular characteristic do public goods and common resources have in common?

Correct Answer
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Public goods and common resour...
View Answer

The commercial value of ivory is a threat to the elephant, but the commercial value of beef is a guardian of the cow. This is because

Correct Answer
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Most goods in the economy are

Correct Answer
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Is a congested nontoll road excludable? Is it rival in consumption? How do we classify a congested nontoll road in terms of the four types of goods?

Correct Answer
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A congested nontoll road is no...
View Answer

Exam 11: Public Goods and Common Resources

A good that is rival in consumption and not excludable is called a

Correct AnswerverifiedShow Answer

Depending on congestion, national parks can be either a common resource or a public good.

Correct AnswerverifiedShow Answer

Which of the following goods is excludable but not rival in consumption?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Figure 11-1 Rival in Consumption? Yes No Excludable? Yes No -Refer to Figure 11-1. Which of the following statements is correct?

Correct AnswerverifiedShow Answer

Because it is

Correct AnswerverifiedShow Answer

A free-rider problem exists for any good that is not

Correct AnswerverifiedShow Answer

On hot summer days, electricity-generating capacity is sometimes stretched to the limit. At these times, electric companies may ask people to voluntarily cut back on their use of electricity. An economist would suggest that

Correct AnswerverifiedShow Answer

A cable television broadcast of a movie is

Correct AnswerverifiedShow Answer

Which of the following would not be considered a private good?

Correct AnswerverifiedShow Answer

Economists think that the best way to determine the value of a human life is to

Correct AnswerverifiedShow Answer

Resources tend to be allocated inefficiently when goods

Correct AnswerverifiedShow Answer

In a cost-benefit analysis, the value of a human life is sometimes calculated on the basis of

Correct AnswerverifiedShow Answer

Scenario 11-2 Consider the following goods: -fire-protection services provided by a fire department -a beautiful mural on the outside wall of a fire station -a firefighter's helmet -Refer to Scenario 11-2. Which of these goods is the best example of a club good? Briefly explain.

Correct AnswerverifiedFire-protection services is th...View AnswerShow Answer

Correct AnswerverifiedShow Answer

Each of the following explains why cost-benefit analysis is difficult except

Correct AnswerverifiedShow Answer

What particular characteristic do public goods and common resources have in common?

Correct AnswerverifiedPublic goods and common resour...View AnswerShow Answer

The commercial value of ivory is a threat to the elephant, but the commercial value of beef is a guardian of the cow. This is because

Correct AnswerverifiedShow Answer

Most goods in the economy are

Correct AnswerverifiedShow Answer

Is a congested nontoll road excludable? Is it rival in consumption? How do we classify a congested nontoll road in terms of the four types of goods?

Correct AnswerverifiedA congested nontoll road is no...View AnswerShow Answer

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Figure 11-1 Rival in Consumption? Yes No Excludable? ^Yes No -Refer to Figure 11-1. Which of the following statements is correct?

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Fire-protection services is th...
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Public goods and common resour...
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A congested nontoll road is no...
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