Quiz 19: Public Goods and Common Resources
Business
Q 1Q 1
A type of good that is subject to market failure is:
A)a public good.
B)a private good.
C)an uncommon resource.
D)None of these goods is subject to market failure.
Free
Multiple Choice
A
Q 2Q 2
When a good ends up overconsumed and depleted,we can assume it is:
A)a common resource.
B)a private good.
C)a public good.
D)an artificially scarce good.
Free
Multiple Choice
A
Q 3Q 3
When a good ends up undersupplied,we can assume it is:
A)a common resource.
B)a private good.
C)a public good.
D)None of these goods can be undersupplied.
Free
Multiple Choice
C
Q 4Q 4
The problem caused by goods that are considered common resources is that they:
A)are overconsumed.
B)are undersupplied.
C)are oversupplied.
D)are underconsumed.
Free
Multiple Choice
Q 5Q 5
Public goods,when left to the private market:
A)will be undersupplied.
B)will be overconsumed.
C)will be underconsumed.
D)will be oversupplied.
Free
Multiple Choice
Q 6Q 6
Which of the following is likely to cause a market failure and be overconsumed?
A)Grazing pastureland
B)Cable TV
C)Public health
D)Education
Free
Multiple Choice
Q 7Q 7
Which of the following is likely to cause market failure and be undersupplied?
A)Research
B)Orange juice
C)River water
D)Grazing pasture
Free
Multiple Choice
Q 8Q 8
When faced with a market failure,the government:
A)usually tries to redistribute the existing surplus more fairly.
B)always takes over the market.
C)often encourages the well-functioning firms to stay through protectionist policy.
D)None of these statements is true.
Free
Multiple Choice
Q 9Q 9
Which of the following goods is most likely to be overconsumed?
A)Fish in the ocean
B)Fish in a pet store
C)Fish in the grocery store
D)None of these is likely to be overconsumed.
Free
Multiple Choice
Q 10Q 10
Which of the following goods is most likely to be overconsumed?
A)Fish in the ocean
B)Chickens on a farm
C)Horses on a ranch
D)None of these is likely to be overconsumed.
Free
Multiple Choice
Q 11Q 11
Which of the following is most likely to be overconsumed?
A)Sparkling water
B)Tap water
C)Bottled water
D)None of these is likely to be overconsumed.
Free
Multiple Choice
Q 12Q 12
When a good is excludable:
A)it is possible for sellers to prevent its use by those who have not paid for it.
B)one person's consumption prevents or decreases others' ability to consume it.
C)consumers have a perception of scarcity of that good.
D)the government has specific import policies limiting its supply.
Free
Multiple Choice
Q 13Q 13
When a good is rival in consumption:
A)one person's consumption prevents or decreases others' ability to consume it.
B)it is possible for sellers to prevent its use by those who have not paid for it.
C)consumers have a perception of scarcity of that good.
D)the government has specific import policies limiting its supply.
Free
Multiple Choice
Q 14Q 14
Private goods are:
A)not rival in consumption,but excludable.
B)rival in consumption and excludable.
C)rival in consumption,but not excludable.
D)not rival in consumption and not excludable.
Free
Multiple Choice
Q 15Q 15
Excludability matters because it:
A)allows owners to set an enforceable price on a good.
B)allows consumers to control the price of a good.
C)creates a perceived scarcity that allows the seller to keep the price artificially high.
D)creates a perceived scarcity that causes buyers to have an inelastic demand for the good.
Free
Multiple Choice
Q 16Q 16
If you can't prevent people from consuming something,then:
A)they have little reason to pay for using it.
B)the good is not excludable.
C)individuals will likely use it for free.
D)All of these statements are true.
Free
Multiple Choice
Q 17Q 17
An example of an excludable good is:
A)ice cream.
B)a movie in a theater.
C)a digital camera.
D)All of these are excludable goods.
Free
Multiple Choice
Q 18Q 18
An example of an excludable good is:
A)a movie in a theater.
B)a city park.
C)a rainbow.
D)None of these is an excludable good.
Free
Multiple Choice
Q 19Q 19
An example of a good that is not excludable is:
A)fish in the ocean.
B)wireless connection to the Internet.
C)a movie in a theater.
D)None of these is excludable.
Free
Multiple Choice
Q 20Q 20
Most goods are:
A)rival in consumption.
B)exclusive.
C)public goods.
D)None of these statements is true.
Free
Multiple Choice
Q 21Q 21
An example of a good that is rival in consumption is:
A)a hamburger.
B)radio signals broadcast over the air.
C)national defense.
D)None of these goods is rival in consumption.
Free
Multiple Choice
Q 22Q 22
An example of a good that is rival in consumption is:
A)a sports car.
B)a paper clip.
C)bottled water.
D)All of these goods are rival in consumption.
Free
Multiple Choice
Q 23Q 23
An example of a good that is rival in consumption is:
A)a sweater.
B)bottled water.
C)tap water.
D)All of these goods are rival in consumption.
Free
Multiple Choice
Q 24Q 24
Goods that are rival in consumption and excludable are:
A)a common resource.
B)a private good.
C)a public good.
D)an artificially scarce good.
Free
Multiple Choice
Q 25Q 25
Goods that are rival in consumption,but not excludable are:
A)a common resource.
B)a private good.
C)a public good.
D)an artificially scarce good.
Free
Multiple Choice
Q 26Q 26
Goods that are not rival in consumption,but are excludable are:
A)a common resource.
B)a private good.
C)a public good.
D)an artificially scarce good.
Free
Multiple Choice
Q 27Q 27
Goods that are neither rival in consumption nor excludable are:
A)a common resource.
B)a private good.
C)a public good.
D)an artificially scarce good.
Free
Multiple Choice
Q 28Q 28
A common resource is:
A)rival in consumption and excludable.
B)not rival in consumption,but excludable.
C)rival in consumption,but not excludable.
D)not rival in consumption and not excludable.
Free
Multiple Choice
Q 29Q 29
A public good is:
A)rival in consumption and excludable.
B)not rival in consumption,but excludable.
C)rival in consumption,but not excludable.
D)not rival in consumption and not excludable.
Free
Multiple Choice
Q 30Q 30
An artificially scarce good is:
A)rival in consumption and excludable.
B)not rival in consumption,but excludable.
C)rival in consumption,but not excludable.
D)not rival in consumption and not excludable.
Free
Multiple Choice
Q 31Q 31
Traffic lights would be considered:
A)a common resource.
B)a private good.
C)a public good.
D)an artificially scarce good.
Free
Multiple Choice
Q 32Q 32
Cookies would be considered:
A)a common resource.
B)a private good.
C)a public good.
D)an artificially scarce good.
Free
Multiple Choice
Q 33Q 33
Fish in the ocean would be considered:
A)a common resource.
B)a private good.
C)a public good.
D)an artificially scarce good.
Free
Multiple Choice
Q 34Q 34
Streaming Netflix movies would be considered:
A)a common resource.
B)a private good.
C)a public good.
D)an artificially scarce good.
Free
Multiple Choice
Q 35Q 35
Fireworks would be considered:
A)a common resource.
B)a private good.
C)a public good.
D)an artificially scarce good.
Free
Multiple Choice
Q 36Q 36
A smart phone would be considered:
A)a common resource.
B)a private good.
C)a public good.
D)an artificially scarce good.
Free
Multiple Choice
Q 37Q 37
Markets work well for allocating ____________ efficiently,but not always so well for allocating ______________________.
A)private goods;public goods
B)public goods;private goods
C)common resources;public goods
D)public goods;common resources
Free
Multiple Choice
Q 38Q 38
The similarity between markets for common resources and markets with externalities is that:
A)the price that competitive firms charge does not capture the true costs and benefits of consumption.
B)the equilibrium quantity is too high in terms of society.
C)government involvement is needed to reach an efficient outcome.
D)All of these statements are true.
Free
Multiple Choice
Q 39Q 39
The free rider problem is caused by:
A)the nonexcludability of a good leading to the undersupply of it.
B)the incentive to oversupply the good since it is nonrival in consumption.
C)the rivalness in consumption of a good leading to the overconsumption of that good.
D)the rivalness in consumption of a good leading to the undersupply of it.
Free
Multiple Choice
Q 40Q 40
When a good is not easily excludable,what people pay for it will:
A)not necessarily reflect the real value they place on it.
B)reflect the real value they place on it.
C)exactly equal the social benefit of the good.
D)All of these statements are true.
Free
Multiple Choice
Q 41Q 41
When what people pay does not necessarily reflect the real value they put on a good,it is likely that:
A)the free rider problem exists.
B)the good will be undersupplied.
C)the good is not easily excludable.
D)All of these statements are true.
Free
Multiple Choice
Q 42Q 42
When the free rider problem is present in a market:
A)what people pay often does not reflect the real value they put on a good.
B)the good will likely be overconsumed.
C)the good is rival in consumption.
D)All of these statements are true.
Free
Multiple Choice
Q 43Q 43
When the free rider problem is present in a market:
A)the good will be oversupplied.
B)the good will be underconsumed.
C)the good is rival in consumption.
D)the good is not excludable.
Free
Multiple Choice
Q 44Q 44
Free riders enjoy:
A)positive externalities from others' choices to pay for a good.
B)negative externalities from others' choices to pay for a good.
C)positive externalities transferred from consumers who receive subsidies.
D)positive externalities from a good they choose to buy themselves.
Free
Multiple Choice
Q 45Q 45
Nonexcludable goods tend to be undersupplied because:
A)the free rider problem persists.
B)people do not pay the true value of the good.
C)people rarely willingly pay for something they could get for free,regardless of how much they value it.
D)All of these statements are true.
Free
Multiple Choice
Q 46Q 46
One way to solve the free-rider problem is:
A)have the government provides the good at a certain cost.
B)make the good or service more excludable.
C)tax those who truly value the good.
D)tax everyone an equal amount for the good.
Free
Multiple Choice
Q 47Q 47
An example of a public good is:
A)national defense.
B)libraries.
C)timber.
D)All of these are public goods.
Free
Multiple Choice
Q 48Q 48
An example of a public good is:
A)health.
B)cleanliness.
C)radio signals.
D)All of these are public goods.
Free
Multiple Choice
Q 49Q 49
Wikipedia is an example of:
A)a public good.
B)a private good.
C)a common resource.
D)an artificially scarce resource.
Free
Multiple Choice
Q 50Q 50
Nonexcludability causes:
A)people to demand a higher quantity than they would if they had to pay for what they consumed.
B)people to demand a lower quantity than they would if they paid for what they consumed.
C)firms to supply a lower quantity than they would if they incurred the full costs of the provision of the good.
D)firms to supply a higher quantity than they would if they had to pay for what they supplied.
Free
Multiple Choice
Q 51Q 51
Nonexcludability,in the case of rival goods,causes:
A)inefficiently high demand.
B)inefficiently low demand.
C)efficient,high demand.
D)efficient,low demand.
Free
Multiple Choice
Q 52Q 52
The combination of inefficiently high demand and dwindling quantity leads to what is called:
A)the free rider problem.
B)nonexcludable consumption.
C)rival in consumption.
D)the tragedy of the commons.
Free
Multiple Choice
Q 53Q 53
The tragedy of the commons is:
A)the undersupply of a public good due to people not wanting to pay for a publicly common good.
B)the disappearance of certain markets due to the lack of willingness to pay by individuals,leading to collective misfortune.
C)the depletion of a common resource due to individually rational but collectively inefficient overconsumption.
D)None of these statements is correct.
Free
Multiple Choice
Q 54Q 54
The depletion of a common resource due to individually rational but collectively inefficient overconsumption is called:
A)the tragedy of the commons.
B)the free rider problem.
C)rival in consumption.
D)excludability.
Free
Multiple Choice
Q 55Q 55
The free-rider problem is triggered by being:
A)nonexcludable.
B)rival in consumption.
C)excludable and rival in consumption.
D)excludable and nonrival in consumption.
Free
Multiple Choice
Q 56Q 56
The tragedy of the commons arises from:
A)the combination of rivalry and nonexcludability.
B)the good being rival.
C)the good being excludable.
D)the combination of rivalry and excludability.
Free
Multiple Choice
Q 57Q 57
When a good is not excludable and rival in consumption:
A)the free rider problem may arise.
B)the tragedy of the commons may arise.
C)the good is likely a private good.
D)the good is likely a common resource.
Free
Multiple Choice
Q 58Q 58
When a good is both rivalrous and nonexcludable:
A)the free rider problem may arise.
B)the tragedy of the commons may arise.
C)the good is likely a private good.
D)the good is likely an artificially scarce good.
Free
Multiple Choice
Q 59Q 59
The free rider problem is triggered when a good is ______________,and the tragedy of the commons arises when a good is ________________
A)nonexcludable;both rivalrous and nonexcludable.
B)rivalrous;both rivalrous and nonexcludable.
C)both rivalrous and nonexcludable;rivalrous.
D)both rivalrous and nonexcludable;excludable.
Free
Multiple Choice
Q 60Q 60
In a market where the tragedy of the commons arises,the equilibrium quantity is both individually ____________ and collectively __________.
A)rational;inefficient
B)inefficient;rational
C)irrational;efficient
D)efficient;irrational
Free
Multiple Choice
Q 61Q 61
Not having to pay for a good leads to:
A)overconsumption.
B)underconsumption.
C)oversupply.
D)None of these statements is true.
Free
Multiple Choice
Q 62Q 62
When someone does not have to pay for a good:
A)it is rational to overconsume.
B)it is irrational to overconsume.
C)it is rational to underconsume.
D)it means there is zero demand for the good.
Free
Multiple Choice
Q 63Q 63
Using a common resource:
A)creates a positive externality for others.
B)maximizes total surplus.
C)is an irrational decision.
D)imposes a negative externality on others.
Free
Multiple Choice
Q 64Q 64
If those who consumed common resources were subject to a tax that was equal to the external costs that they imposed due to the negative externality created,their demand curve:
A)would shift straight down and they would consume less.
B)would shift straight up and they would consume more.
C)would shift straight down and they would consume more.
D)would shift straight up and they would consume less.
Free
Multiple Choice
Q 65Q 65
If those who consumed common resources were subject to a tax that was equal to the external costs that they imposed due to the negative externality created:
A)an efficient level would be reached.
B)total surplus would be maximized for the whole society.
C)individuals would consume less.
D)All of these statements are true.
Free
Multiple Choice
Q 66Q 66
When goods are subject to market failure,one possible solution is to:
A)change social norms.
B)have government either regulate the market or provide the good.
C)privatize the good.
D)All of these are possible solutions.
Free
Multiple Choice
Q 67Q 67
All solutions to market failures in markets for public goods or common resources:
A)try to force the internalization of externalities.
B)must be provided by the government.
C)are not perfect,and total surplus cannot be maximized in these markets.
D)need to be accepted by the affected parties to be effective.
Free
Multiple Choice
Q 68Q 68
When government tries to change social norms,they:
A)might run an extensive ad campaign.
B)are trying to change people's opinions about their actions.
C)try to get consumers to internalize the cost or benefit they cause by their market decision.
D)All of these statements are true.
Free
Multiple Choice
Q 69Q 69
If the government runs an ad campaign to shame litterers,they are:
A)wasting a lot of money.
B)trying to get individuals to internalize the negative externality created by their decision to litter.
C)using protectionist policy to help the trash-collecting industry.
D)All of these statements are true.
Free
Multiple Choice
Q 70Q 70
In order to eliminate a free rider problem or tragedy of the commons problem:
A)the social costs must be realized by the individual.
B)something must be done to alter individuals' trade-offs.
C)market participants must internalize the value of the externality.
D)All of these statements are true.
Free
Multiple Choice
Q 71Q 71
When we consider solving a free rider problem through changing social norms,it is helpful to remember:
A)all costs aren't financial.
B)social disapproval can be considered a cost.
C)conflict with those in your community can be considered a cost.
D)All of these statements are true.
Free
Multiple Choice
Q 72Q 72
Social disapproval carries a higher cost in places where you:
A)know the people around you.
B)care about the opinions of people around you.
C)expect to interact with the people around you again in the future.
D)All of these statements are true.
Free
Multiple Choice
Q 73Q 73
Social disapproval is likely to be more effective:
A)in a small town than a large city.
B)in solving a free rider problem than a tragedy of the commons problem.
C)than taxation.
D)All of these statements are true.
Free
Multiple Choice
Q 74Q 74
One "design principle" that makes informal,community-based solutions to public goods and common resource problems more effective is:
A)clear distinctions between who is and is not allowed to access the resource.
B)the participation of resource users in setting the rules for use.
C)the ability of users to monitor one another.
D)All of these are important to the effectiveness of community-based solutions.
Free
Multiple Choice
Q 75Q 75
One "design principle" that makes informal,community-based solutions to public goods and common resource problems more effective is:
A)the government setting clear rules for use.
B)individual pledges to self-monitor their actions.
C)clear distinctions between who is and is not allowed to access the resource.
D)All of these are important to the effectiveness of community-based solutions.
Free
Multiple Choice
Q 76Q 76
Elinor Ostrom won the 2009 Nobel Prize in economics for her research showing:
A)social norms can sometimes be powerful enough for commonly held property to be managed extremely well.
B)social norms are not an effective solution for the management of commonly held property.
C)that privatization of public goods is the most effective solution to market failure associated with commonly held property.
D)government provision of public goods is the most efficient solution to the tragedy of the commons problem.
Free
Multiple Choice
Q 77Q 77
In 2009,the Nobel Prize in economics was awarded for work on the effectiveness of social norms in the management of commonly held property to:
A)Arthur Pigou.
B)Gary Becker.
C)Elinor Ostrom.
D)Ronald Coase.
Free
Multiple Choice
Q 78Q 78
Government intervention can be productive and efficiency enhancing:
A)whenever it regulates a market.
B)in markets for public goods and common resources.
C)because the government always acts with altruistic motives.
D)except in markets for public goods.
Free
Multiple Choice
Q 79Q 79
Because government bodies have the power to impose limits on how much of a resource is consumed:
A)it can be efficiency enhancing in markets for common resources.
B)it will always cause deadweight loss.
C)they decide what is the "right" amount for the public to consume.
D)they will often correct a market before testing the effectiveness of social norms to correct the problem.
Free
Multiple Choice
Q 80Q 80
Because government bodies have the power to make up for inadequate supply of a good:
A)its presence as a producer is in virtually every market.
B)it can be efficiency enhancing in markets for public goods.
C)they have incentive to compete with local businesses.
D)None of these statements is true.
Free
Multiple Choice
Q 81Q 81
One way the government can enhance efficiency through the management of public goods and common resources is by:
A)banning the good.
B)setting quotas for the good.
C)government provision of the good.
D)All of these can be effective and efficiency-enhancing solutions.
Free
Multiple Choice
Q 82Q 82
When the government bans a good:
A)it is attempting to solve the nonexcludability problem.
B)it makes acquiring that good illegal.
C)the cost of breaking the ban changes the trade-offs consumers face.
D)All of these statements are true.
Free
Multiple Choice
Q 83Q 83
When the government bans a good:
A)it is an easy,but often ineffective,solution to the nonexcludability problem.
B)it creates a more efficient solution than any other to the nonexcludability problem.
C)it increases surplus more than any other solution to the nonexcludability problem.
D)it is the easiest and most effective solution to the nonexcludability problem.
Free
Multiple Choice
Q 84Q 84
When the government bans a good:
A)the cost of breaking the ban needs to be sufficiently high in order to be effective.
B)it changes the trade-offs consumers face.
C)it will only be effective if it can be easily enforced.
D)All of these statements are true.
Free
Multiple Choice
Q 85Q 85
The costs involved with breaking a ban placed on a good:
A)depend on the punishment associated with rule breaking.
B)depend on the likelihood of being caught.
C)depend on the likelihood of being punished if caught.
D)All of these can affect costs involved with breaking a ban placed on a good.
Free
Multiple Choice
Q 86Q 86
If the punishment associated with breaking a ban is not severe enough,it may:
A)not alter the trade-offs enough to change the consumption patterns of the banned good.
B)cause even more consumption of the good,exaggerating the problem.
C)still decrease the consumption of the good if the price of the good changes.
D)still be effective if it gains media attention.
Free
Multiple Choice
Q 87Q 87
A government ban on a good that suffers from overconsumption may be ineffective if:
A)the likelihood of being caught breaking the ban is very low.
B)the likelihood of being caught breaking the ban is sufficiently high.
C)the punishment for breaking the ban is severe.
D)the public did not participate in setting the punishments.
Free
Multiple Choice
Q 88Q 88
If the punishment is _________,or the likelihood of getting caught is _________,the cost associated with breaking a ban may not be high enough to change the trade-off that consumers face.
A)not severe;low
B)severe;high
C)severe;low
D)not severe;high
Free
Multiple Choice
Q 89Q 89
Bans and quotas ___________ in situations where it is difficult or costly for authorities to monitor and punish rule-breakers.
A)rarely succeed
B)often succeed
C)sometimes succeed
D)always succeed
Free
Multiple Choice
Q 90Q 90
Bans or quotas that limit the use of common resources are straightforward public-policy approaches to solving the problem of overuse if:
A)countries have the resources to enforce them.
B)the community agrees to aid in its enforcement.
C)the community affected participates in setting the punishments for breaking the policy.
D)None of these statements is true.
Free
Multiple Choice
Q 91Q 91
When the optimal quantity of consumption is zero for a given good:
A)a ban is often the best solution.
B)changing social norms is often the best solution.
C)privatizing the good is often the best solution.
D)government provision of the good is often the best solution.
Free
Multiple Choice
Q 92Q 92
Bans are applied to:
A)common-resource problems.
B)reduce the inefficiency created by overuse.
C)situations where the optimal quantity of consumption is zero.
D)All of these statements are true.
Free
Multiple Choice
Q 93Q 93
To combat the undersupply of public goods,a solution is:
A)for the government to step in and provide it directly.
B)to place a quota on the consumption of the good.
C)to change social norms around consumption of the good.
D)All of these are effective ways to deal with the undersupply of public goods.
Free
Multiple Choice
Q 94Q 94
In a functioning market,people will buy a good up to the point where:
A)the marginal benefit of the last unit is equal to the marginal cost of that unit.
B)the marginal benefit of each unit is equal to the marginal cost of each unit.
C)the total benefit of the good is equal to the total cost of the good.
D)they can no longer afford it.
Free
Multiple Choice
Q 95Q 95
If the marginal benefit were greater than the cost of a good:
A)consumers could increase their utility by buying more.
B)consumers could increase their utility by buying less.
C)producers should decrease production.
D)None of these is true.
Free
Multiple Choice
Q 96Q 96
If the cost were greater than the marginal benefit of a good:
A)consumers could increase their utility by buying more.
B)consumers could increase their utility by buying less.
C)producers should increase production.
D)None of these is true.
Free
Multiple Choice
Q 97Q 97
If the government is supplying a public good,the efficient quantity is where:
A)the marginal social benefit equals the cost.
B)the total social benefit equals the cost.
C)the marginal social benefit is greater than the cost.
D)the total social benefit outweighs the total cost.
Free
Multiple Choice
Q 98Q 98
The marginal social benefit is:
A)the sum of the marginal benefit gained by each individual user.
B)the benefit gained by the last user.
C)the total benefit gained by the last user.
D)the sum of the benefit gained by each individual user.
Free
Multiple Choice
Q 99Q 99
When choosing the right amount of a public good to supply,the government:
A)often guesses,because people have an incentive to overstate a good's value.
B)often provides too much,because people have an incentive to understate a good's value.
C)often provides too little,because people have an incentive to overstate a good's value.
D)often fails to provide it,because people have an incentive to understate a good's value.
Free
Multiple Choice
Q 100Q 100
One way the government decides how to pay for public goods is:
A)how easy it is to exclude people who don't pay.
B)determining who uses the good the most and increasing their property taxes.
C)comparing individual's marginal benefits of the good.
D)None of these statements is true.
Free
Multiple Choice
Q 101Q 101
One way the government decides how to pay for a public good is:
A)if they can make the good excludable and charge its users.
B)the ease of collecting payout.
C)the transfer of surplus.
D)All of these are ways the government allocates payment of public goods.
Free
Multiple Choice
Q 102Q 102
An example of a public good that the government has made excludable is:
A)toll roads.
B)city buses.
C)state colleges.
D)All of these are excludable public goods.
Free
Multiple Choice
Q 103Q 103
An example of a public good that the government has made excludable is:
A)city buses.
B)sewer systems.
C)police protection.
D)All of these are excludable public goods.
Free
Multiple Choice
Q 104Q 104
An example of a public good that is difficult to make excludable is:
A)sewer systems.
B)fire protection.
C)national defense.
D)All of these are nonexcludable public goods.
Free
Multiple Choice
Q 105Q 105
An example of a public good that is difficult to make excludable is:
A)toll roads.
B)city buses.
C)state universities.
D)None of these is a nonexcludable public good.
Free
Multiple Choice
Q 106Q 106
A modern example of privatizing a common resource is:
A)patents.
B)quotas.
C)taxes.
D)subsidies.
Free
Multiple Choice
Q 107Q 107
When the government privatizes a common resource,it:
A)forces the owner to consider all the costs and benefits of their consumption choices.
B)creates excludability.
C)increases efficiency.
D)All of these statements are true.
Free
Multiple Choice
Q 108Q 108
One of the difficulties of the government privatizing a common resource is:
A)figuring out who owns what when many are using the resource.
B)deciding which individuals will have to decrease their consumption.
C)compounded the more users there are.
D)All of these statements are true.
Free
Multiple Choice
Q 109Q 109
Using tradable allowances instead of quotas may be a better solution to the provision of common resources because:
A)tradable allowances allocate the good in the most efficient way,and quotas do not.
B)tradable allowances ensure that the resource is allocated to those with the highest willingness to pay,while quotas do not.
C)tradable allowances assign private property rights-and an incentive,as owners,to make sure that the common resource does not get overused,and quotas do not.
D)All of these statements are true.
Free
Multiple Choice
Q 110Q 110
Like negative externalities,tradable permits are useful in allocating common resources because:
A)the depletion of common resources imposes a negative externality.
B)the problem present in both is overconsumption.
C)the socially optimal quantity is not the same as the individual consumers in either case.
D)All of these statements are true.
Free
Multiple Choice