Question 1

Alex and Ben are both loggers wanting to harvest timber from the same forest.Alex prefers to harvest and replant at a sustainable rate; Ben wants to harvest as many trees as possible to maximize short-run profit and then move on.They face the same production costs.If property rights are poorly enforced or nonexistent,

Accepted Answer

A)  Ben will choose to harvest as quickly as possible, but Alex will choose to harvest more slowly and replant.
B)  both will harvest trees as quickly as possible, before the other one does.
C)  both now have an incentive to harvest and replant in a sustainable manner.
D)  we would expect them to form an agreement on harvesting and replanting.E) None of the above
F) A) and D)

Question 2

Which of the following is a major reason to believe that we are not likely to run out of natural resources?

Accepted Answer

A)  slower GDP growth rates
B)  declining birthrates
C)  more renewable resources
D)  rising mortality or death ratesE) C) and D)
F) B) and D)

Question 3

Individual transferable quotas are limited in their effectiveness because

Accepted Answer

A)  they are only enforceable within 200 miles of a nation's shores.
B)  government, rather than the market, sets their price.
C)  they encourage wasteful spending by fishers in ITQ areas.
D)  they are not tradable.E) A) and B)
F) A) and C)

Question 4

About one-half of U.S.electricity is generated using petroleum.

Accepted Answer

A) True 
 B)False

Question 5

Commercially run forestry companies have the most profit incentive to harvest trees from a forest

Accepted Answer

A)  early in the forest growth cycle.
B)  in the middle of the forest growth cycle.
C)  before the trees are fully mature.
D)  after the trees can no longer grow.E) A) and D)
F) None of the above

Question 6

The period since the Industrial Revolution has been extraordinary because, despite unprecedented

Accepted Answer

A)  population growth, there has been a substantial increase in the standard of living in industrialized nations.
B)  population growth, there has been a substantial decrease in the productivity in industrialized nations.
C)  declines in economic efficiency, there has been a rise in the standard of living in industrialized nations.
D)  declines in economic efficiency, there has been a rise in population growth in industrialized nations.E) All of the above
F) B) and C)

Question 7

Future shortages in natural resource markets are not expected to occur widely due to

Accepted Answer

A)  reduced hours at work.
B)  reduced population growth.
C)  higher standards of living.
D)  higher per capita consumption.E) All of the above
F) A) and B)

Question 8

According to demographers.The "demographic transition" resulting from an increase in living standards follows a pattern of

Accepted Answer

A)  death rates falling ahead of a decline in birthrates.
B)  death rates falling after birthrates fall.
C)  death rates rising as birthrates fall.
D)  death rates rising as birthrates rise.E) A) and D)
F) C) and D)

Question 9

Global resource demand has

Accepted Answer

A)  remained relatively constant because increases in population have been offset by declining consumption per person.
B)  declined because of technological progress.
C)  remained constant because population growth and increased consumption per person have been offset by technological progress.
D)  increased because population growth and increased consumption per person have more than offset reduced demand due to technological progress.E) A) and D)
F) A) and B)

Question 10

The table shows the quantity of gold bars (Qb)  in thousands, the extraction cost for each thousand bars (in millions of dollars) , and the user cost of each thousand bars (in millions of dollars)  facing the OZ Mining Company this year.Suppose that a new government regulation is going to shut down OZ's mining operation one year from now.Assuming that all gold extracted is sold in the same year (cannot be stockpiled for later sale) , how will the regulation affect
The user cost?

Accepted Answer

A)  It will have no effect on the user cost.
B)  The effect on the user cost cannot be determined.
C)  The user cost will rise because the rate of extraction will rise.
D)  The user cost will become zero because they will not be able to extract in the future.E) All of the above
F) A) and B)

Question 11

Renewable energy sources account for about 50 percent of U.S.electricity generation.

Accepted Answer

A) True 
 B)False

Question 12

If energy use per capita in developed countries had leveled off, while GDP per capita had risen, then it must mean that

Accepted Answer

A)  energy efficiency had risen.
B)  energy efficiency had fallen.
C)  the energy-use-to-GDP ratio had risen.
D)  the GDP-to-energy-use ratio had fallen.E) A) and B)
F) B) and C)

Question 13

In his Essay on the Principles of Population, Thomas Malthus argued that

Accepted Answer

A)  human living standards could permanently rise above subsistence levels, so that populations would grow exponentially.
B)  any increase in living standards would be temporary because people will have more children and increase the population, thus bringing living standards back
C)  as the population increases, the standard of living would grow as well because of rising productivity.
D)  as economic efficiency declined, standards of living would first fall and then eventually rise as the population starts increasing.E) None of the above
F) A) and B)

Question 14

In the extraction of a nonrenewable resource, increased current extraction will reduce the extraction firm's user costs.

Accepted Answer

A) True 
 B)False

Question 15

Melanie and Oli are competing Pacific halibut fishers.Both have been allocated ITQs that limit their catch to 1,000 tons of Pacific halibut each.Melanie's cost per ton is $20; Oli's cost per ton is $28.If the market price of Pacific halibut is $40 per ton, what is the minimum amount per ton that Melanie would have to offer Oli to convince him to sell Melanie his ITQs?

Accepted Answer

A)  $8
B)  $10
C)  $20
D)  $12E) B) and D)
F) A) and B)

Question 16

Rapid population growth since 1800 has occurred primarily because of

Accepted Answer

A)  a significant increase in total fertility rates as living standards have risen.
B)  a significant reduction in death rates as living standards have risen.
C)  a significant increase in replacement rates as living standards have risen.
D)  all of the reasons given in the other possible answers.E) A) and D)
F) B) and C)

Question 17

An oil company has the opportunity to extract oil from a reserve in three years with a per barrel profit of $70 per barrel.The current market rate of interest is 4 percent.The present value of this future extraction is about

Accepted Answer

A)  $55.
B)  $62.
C)  $70.
D)  $72.E) A) and D)
F) C) and D)

Question 18

Forestry companies typically harvest and replant an area when trees are

Accepted Answer

A)  very young and growing slowly.
B)  middle aged and growing rapidly.
C)  near the end of their rapid-growth period.
D)  extremely old and about to die anyway.E) C) and D)
F) None of the above

Question 19

Nonrenewable natural resources are fixed in supply (actually or virtually).

Accepted Answer

A) True 
 B)False

Question 20

The long-run total demand for commodity resources is driven by which of the following forces?

Accepted Answer

A)  rising number of people alive and an increasing amount of consumption per person
B)  stable number of people alive and an increasing amount of consumption per person
C)  rising number of people alive and a stable amount of consumption per person
D)  rising number of people alive and a decreasing amount of consumption per personE) A) and B)
F) A) and C)

Exam 19: Natural Resource and Energy Economics

About one-half of U.S.electricity is generated using petroleum.

Correct Answer
verified

Future shortages in natural resource markets are not expected to occur widely due to

Correct Answer
verified

Which of the following is a major reason to believe that we are not likely to run out of natural resources?

Correct Answer
verified

Forestry companies typically harvest and replant an area when trees are

Correct Answer
verified

Correct Answer
verified

The long-run total demand for commodity resources is driven by which of the following forces?

Correct Answer
verified

Commercially run forestry companies have the most profit incentive to harvest trees from a forest

Correct Answer
verified

An oil company has the opportunity to extract oil from a reserve in three years with a per barrel profit of $70 per barrel.The current market rate of interest is 4 percent.The present value of this future extraction is about

Correct Answer
verified

Rapid population growth since 1800 has occurred primarily because of

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

According to demographers.The "demographic transition" resulting from an increase in living standards follows a pattern of

Correct Answer
verified

The period since the Industrial Revolution has been extraordinary because, despite unprecedented

Correct Answer
verified

Individual transferable quotas are limited in their effectiveness because

Correct Answer
verified

In his Essay on the Principles of Population, Thomas Malthus argued that

Correct Answer
verified

Global resource demand has

Correct Answer
verified

Renewable energy sources account for about 50 percent of U.S.electricity generation.

Correct Answer
verified

Nonrenewable natural resources are fixed in supply (actually or virtually).

Correct Answer
verified

In the extraction of a nonrenewable resource, increased current extraction will reduce the extraction firm's user costs.

Correct Answer
verified

If energy use per capita in developed countries had leveled off, while GDP per capita had risen, then it must mean that

Correct Answer
verified

Exam 19: Natural Resource and Energy Economics

About one-half of U.S.electricity is generated using petroleum.

Correct AnswerverifiedShow Answer

Future shortages in natural resource markets are not expected to occur widely due to

Correct AnswerverifiedShow Answer

Which of the following is a major reason to believe that we are not likely to run out of natural resources?

Correct AnswerverifiedShow Answer

Forestry companies typically harvest and replant an area when trees are

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The long-run total demand for commodity resources is driven by which of the following forces?

Correct AnswerverifiedShow Answer

Commercially run forestry companies have the most profit incentive to harvest trees from a forest

Correct AnswerverifiedShow Answer

An oil company has the opportunity to extract oil from a reserve in three years with a per barrel profit of $70 per barrel.The current market rate of interest is 4 percent.The present value of this future extraction is about

Correct AnswerverifiedShow Answer

Rapid population growth since 1800 has occurred primarily because of

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

According to demographers.The "demographic transition" resulting from an increase in living standards follows a pattern of

Correct AnswerverifiedShow Answer

The period since the Industrial Revolution has been extraordinary because, despite unprecedented

Correct AnswerverifiedShow Answer

Individual transferable quotas are limited in their effectiveness because

Correct AnswerverifiedShow Answer

In his Essay on the Principles of Population, Thomas Malthus argued that

Correct AnswerverifiedShow Answer

Global resource demand has

Correct AnswerverifiedShow Answer

Renewable energy sources account for about 50 percent of U.S.electricity generation.

Correct AnswerverifiedShow Answer

Nonrenewable natural resources are fixed in supply (actually or virtually).

Correct AnswerverifiedShow Answer

In the extraction of a nonrenewable resource, increased current extraction will reduce the extraction firm's user costs.

Correct AnswerverifiedShow Answer

If energy use per capita in developed countries had leveled off, while GDP per capita had risen, then it must mean that

Correct AnswerverifiedShow Answer

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