Question 1

Knowledge that is patented is a

Accepted Answer

A)  public good, whereas knowledge that is not patented is a common resource.
B)  private good, whereas knowledge that is not patented is a club good.
C)  common resource, whereas knowledge that is not patented is a private good.
D)  club good, whereas knowledge that is not patented is a public good.

Question 2

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 3

One benefit of the patent system is that it encourages the production of technical knowledge.

Accepted Answer

A) True 
 B)False

Question 4

Excludability is the property of a good whereby

Accepted Answer

A)  one person's use diminishes other peoples' use.
B)  a person can be prevented from using it.
C)  the government rations the quantity of a good that is available.
D)  the resource is congestible.

Question 5

A congested side street in your neighborhood 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.

Question 6

When the value of a human life is calculated according to the economic contribution a person makes to society (as reflected in her income-earning potential) , the troubling implication is that

Accepted Answer

A)  it is possible for a retired or disabled person to have no value to society.
B)  economists are more valuable than entrepreneurs.
C)  retired people who volunteer in their communities are more valuable than physicians.
D)  all workers have equal value.

Question 7

When free riders are present in a market, the market generally fails to provide the efficient outcome.

Accepted Answer

A) True 
 B)False

Question 8

The national defense of the United States is not excludable because

Accepted Answer

A)  my enjoyment of the national defense does not diminish your enjoyment of the national defense of the United States.
B)  my enjoyment of the national defense does diminish your enjoyment of the national defense of the United States.
C)  once the nation is defended, it is impossible to prevent any single person from enjoying the benefit of this defense.
D)  once the nation is defended, it is possible to prevent any single person from enjoying the benefit of this defense.

Question 9

Fire protection is a

Accepted Answer

A)  club good, because it is excludable but not rival in consumption.
B)  club good, because it is rival in consumption but not excludable.
C)  a public good, because it is excludable but not rival in consumption.
D)  a public good, because it is rival in consumption but not excludable.

Question 10

The Tragedy of the Commons results when a good is

Accepted Answer

A)  rival in consumption and not excludable.
B)  excludable and not rival in consumption.
C)  both rival in consumption and excludable.
D)  neither rival in consumption nor excludable.

Question 11

The U.S. military defends Jacob from foreign attackers. The fact that Jacob enjoys this protection does not detract from others Americans' enjoyment of it. For this reason, we say that national defense is

Accepted Answer

A)  excludable.
B)  not excludable.
C)  rival in consumption.
D)  not rival in consumption.

Question 12

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 $360 and the families have agreed to split the cost of the streetlights equally. If the families vote to determine the number of streetlights to install, basing their decision solely on their own willingness to pay (and trying to maximize their own surplus) , what is the greatest number of streetlights for which the majority of families would vote "yes?"

Accepted Answer

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

Question 13

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.

Question 14

As with many public goods, determining the appropriate level of government support for the production of general knowledge is difficult because

Accepted Answer

A)  patents correct for an unknown portion of the externality.
B)  benefits are hard to measure.
C)  members of Congress are often experts in the sciences.
D)  the costs always exceed the benefits.

Question 15

Which of the following is not a common resource?

Accepted Answer

A)  elephants in the wild
B)  a narrow trail in a park
C)  a neighborhood garden
D)  Neither a nor b is a common resource.

Question 16

A study that compares the costs and benefits to society of providing a public good is called externality analysis.

Accepted Answer

A) True 
 B)False

Question 17

The mayor of Newton is considering proposals to deal with an unsafe intersection. She could install a traffic light at a cost of $50,000 or she could install stop signs at a cost of $5,000. The traffic light is expected to reduce the risk of fatality by 0.45 percent and the stop signs are expected to reduce the risk of fatality by 0.054 percent. If the value of human life is estimated to be $10 million, what choice should the mayor make? Briefly explain.

Accepted Answer

The mayor should install stop ...

Question 18

Scenario 11-3
Consider the following goods:
• a fish fillet served at a restaurant
• fish in the ocean
• exotic fish in a huge aquarium in a privately-owned building
-Refer to Scenario 11-3. Which of these goods is the best example of a common resource? Briefly explain.

Accepted Answer

Fish in the ocean is the best ...

Question 19

Who among the following is a free rider?

Accepted Answer

A)  Ernie listens to National Public Radio, but does not contribute to any fundraising efforts.
B)  Bert takes the commuter rail to work, but he purchases the discounted monthly passes rather than buying tickets each day.
C)  Grover sends his 5 children to a private school rather than to the public school in his neighborhood.
D)  Oscar goes to Elmo's house to watch a football game on the local television channel.

Question 20

Pollution is a

Accepted Answer

A)  problem that is entirely unrelated to the parable called the Tragedy of the Commons.
B)  problem that cannot be remedied with regulations or corrective taxes.
C)  negative externality that can be viewed as a public-goods problem.
D)  negative externality that can be viewed as a common-resource problem.

Exam 11: Public Goods and Common Resources

One benefit of the patent system is that it encourages the production of technical knowledge.

Correct Answer
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Knowledge that is patented is a

Correct Answer
verified

The national defense of the United States is not excludable because

Correct Answer
verified

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

Correct Answer
verified

Who among the following is a free rider?

Correct Answer
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Pollution is a

Correct Answer
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A congested side street in your neighborhood is

Correct Answer
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Correct Answer
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The mayor should install stop ...
View Answer

When the value of a human life is calculated according to the economic contribution a person makes to society (as reflected in her income-earning potential) , the troubling implication is that

Correct Answer
verified

Scenario 11-3 Consider the following goods: • a fish fillet served at a restaurant • fish in the ocean • exotic fish in a huge aquarium in a privately-owned building -Refer to Scenario 11-3. Which of these goods is the best example of a common resource? Briefly explain.

Correct Answer
verified
Fish in the ocean is the best ...
View Answer

Which of the following is not a common resource?

Correct Answer
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A study that compares the costs and benefits to society of providing a public good is called externality analysis.

Correct Answer
verified

Correct Answer
verified

When free riders are present in a market, the market generally fails to provide the efficient outcome.

Correct Answer
verified

As with many public goods, determining the appropriate level of government support for the production of general knowledge is difficult because

Correct Answer
verified

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,

Correct Answer
verified

Excludability is the property of a good whereby

Correct Answer
verified

The U.S. military defends Jacob from foreign attackers. The fact that Jacob enjoys this protection does not detract from others Americans' enjoyment of it. For this reason, we say that national defense is

Correct Answer
verified

Fire protection is a

Correct Answer
verified

The Tragedy of the Commons results when a good is

Correct Answer
verified

Exam 11: Public Goods and Common Resources

One benefit of the patent system is that it encourages the production of technical knowledge.

Correct AnswerverifiedShow Answer

Knowledge that is patented is a

Correct AnswerverifiedShow Answer

The national defense of the United States is not excludable because

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Who among the following is a free rider?

Correct AnswerverifiedShow Answer

Pollution is a

Correct AnswerverifiedShow Answer

A congested side street in your neighborhood is

Correct AnswerverifiedShow Answer

Correct AnswerverifiedThe mayor should install stop ...View AnswerShow Answer

When the value of a human life is calculated according to the economic contribution a person makes to society (as reflected in her income-earning potential) , the troubling implication is that

Correct AnswerverifiedShow Answer

Scenario 11-3 Consider the following goods: • a fish fillet served at a restaurant • fish in the ocean • exotic fish in a huge aquarium in a privately-owned building -Refer to Scenario 11-3. Which of these goods is the best example of a common resource? Briefly explain.

Correct AnswerverifiedFish in the ocean is the best ...View AnswerShow Answer

Which of the following is not a common resource?

Correct AnswerverifiedShow Answer

A study that compares the costs and benefits to society of providing a public good is called externality analysis.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

When free riders are present in a market, the market generally fails to provide the efficient outcome.

Correct AnswerverifiedShow Answer

As with many public goods, determining the appropriate level of government support for the production of general knowledge is difficult because

Correct AnswerverifiedShow Answer

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,

Correct AnswerverifiedShow Answer

Excludability is the property of a good whereby

Correct AnswerverifiedShow Answer

The U.S. military defends Jacob from foreign attackers. The fact that Jacob enjoys this protection does not detract from others Americans' enjoyment of it. For this reason, we say that national defense is

Correct AnswerverifiedShow Answer

Fire protection is a

Correct AnswerverifiedShow Answer

The Tragedy of the Commons results when a good is

Correct AnswerverifiedShow 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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The mayor should install stop ...
View Answer

Correct Answer
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Correct Answer
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Fish in the ocean is the best ...
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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