Question 1

What determines how a government will pay for a public good?

Accepted Answer

A)  The ease of collecting payout
B)  If the good can be made excludable
C)  The transfer of surplus
D)  All of these affect how a government allocates payment of public goods.E) B) and C)
F) A) and B)

Question 2

When what people pay for a good does not necessarily reflect the real value they place on it, it is likely that the:

Accepted Answer

A)  free rider problem exists.
B)  good will be oversupplied.
C)  tragedy of the commons problem exists.
D)  good is nonrivalrous.E) A) and C)
F) A) and D)

Question 3

When a good becomes overconsumed and depleted, we can assume it is most likely a:

Accepted Answer

A)  common resource.
B)  private good.
C)  public good.
D)  scarce good.E) All of the above
F) None of the above

Question 4

Which of the following is an excludable good or service?

Accepted Answer

A)  National Defense
B)  A public park
C)  Ice cream
D)  AirE) A) and B)
F) A) and D)

Question 5

When a good is excludable:

Accepted Answer

A)  one person's consumption of the good prevents or decreases the ability of others to consume it.
B)  sellers can prevent people who have not paid for the good from using it.
C)  consumers have a perception that the good is scarce.
D)  the government enacts specific import policies limiting the good's supply.E) A) and D)
F) None of the above

Question 6

Goods that are considered common resources are commonly:

Accepted Answer

A)  undersupplied.
B)  oversupplied.
C)  underconsumed.
D)  overconsumed.E) B) and C)
F) None of the above

Question 7

Bans and quotas _______ succeed in situations where it is difficult or costly for authorities to monitor and punish rule-breakers.

Accepted Answer

A)  often
B)  never
C)  rarely
D)  alwaysE) A) and B)
F) A) and C)

Question 8

Social disapproval carries a higher cost when you:

Accepted Answer

A)  don't really know the people around you.
B)  don't care about the opinions of community members.
C)  rarely expect to interact with the people around you again.
D)  have very close interactions with community members.E) B) and D)
F) A) and B)

Question 9

Traffic lights would be considered:

Accepted Answer

A)  a common resource.
B)  a private good.
C)  a public good.
D)  an artificially scarce good.E) All of the above
F) B) and C)

Question 10

One way to solve the free rider problem is to:

Accepted Answer

A)  have the government provide 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.E) B) and C)
F) None of the above

Question 11

A public good is:

Accepted Answer

A)  rival in consumption and excludable.
B)  excludable, but not rival in consumption.
C)  rival in consumption, but not excludable.
D)  neither rival in consumption nor excludable.E) A) and D)
F) A) and C)

Question 12

If the punishment for breaking a government ban is _________, or the likelihood of getting caught is _________, the cost associated with breaking the ban may not be high enough to change the trade-off that consumers face.

Accepted Answer

A)  not severe; low
B)  severe; high
C)  severe; low
D)  not severe; highE) A) and B)
F) A) and C)

Question 13

When a government bans a good:

Accepted Answer

A)  it is attempting to solve the tragedy of the commons.
B)  it makes acquiring that good illegal.
C)  the cost of breaking the ban changes the trade-offs consumers face.
D)  All of these are true.E) None of the above
F) A) and B)

Question 14

Wikipedia would be considered:

Accepted Answer

A)  a public good.
B)  a private good.
C)  a common resource.
D)  an artificially scarce resource.E) B) and D)
F) A) and B)

Question 15

Which of the following is not an excludable good or service?

Accepted Answer

A)  Fish in the ocean
B)  A wireless connection to the Internet
C)  A movie in a theater
D)  A candy barE) C) and D)
F) B) and D)

Question 16

The free rider problem is caused by the/a good's _______, which leads to the/an ________ of the good.

Accepted Answer

A)  nonexcludability; undersupply
B)  "nonrivalness" in consumption; oversupply
C)  "rivalness" in consumption; overconsumption
D)  "rivalness" in consumption; undersupplyE) B) and C)
F) C) and D)

Question 17

The free-rider problem exists when a good is:

Accepted Answer

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

Question 18

Which of the following is a public good that is difficult to make excludable?

Accepted Answer

A)  Toll roads
B)  City buses
C)  State universities
D)  Police protectionE) B) and D)
F) B) and C)

Question 19

Fish in the ocean would be considered:

Accepted Answer

A)  a common resource.
B)  a private good.
C)  a public good.
D)  an artificially scarce good.E) B) and D)
F) B) and C)

Question 20

Which of the following is a public good that is difficult to make excludable?

Accepted Answer

A)  Sewer systems
B)  Fire protection
C)  National Defense
D)  All of these are nonexcludable public goods.E) B) and D)
F) All of the above

Exam 19: Public Goods and Common Resources

When a good is excludable:

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When a government bans a good:

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One way to solve the free rider problem is to:

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Traffic lights would be considered:

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When what people pay for a good does not necessarily reflect the real value they place on it, it is likely that the:

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The free-rider problem exists when a good is:

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Which of the following is a public good that is difficult to make excludable?

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Wikipedia would be considered:

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Bans and quotas _______ succeed in situations where it is difficult or costly for authorities to monitor and punish rule-breakers.

Correct AnswerverifiedShow Answer

What determines how a government will pay for a public good?

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The free rider problem is caused by the/a good's _______, which leads to the/an ________ of the good.

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Social disapproval carries a higher cost when you:

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Which of the following is not an excludable good or service?

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A public good is:

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If the punishment for breaking a government ban is _________, or the likelihood of getting caught is _________, the cost associated with breaking the ban may not be high enough to change the trade-off that consumers face.

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Which of the following is a public good that is difficult to make excludable?

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Which of the following is an excludable good or service?

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Goods that are considered common resources are commonly:

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When a good becomes overconsumed and depleted, we can assume it is most likely a:

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Fish in the ocean would be considered:

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The free rider problem is caused by the/a good's _, which leads to the/an __ of the good.

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If the punishment for breaking a government ban is _, or the likelihood of getting caught is _, the cost associated with breaking the ban may not be high enough to change the trade-off that consumers face.

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