Chapter 11 Quizlet – Flashcards
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It would always be a mistake to view
a. a streetlight as a common resource.
b. a nontoll road as a public good.
c. the environment as a common resource.
d. a lighthouse as a public good.
answer
a. a streetlight as a common resource.
question
Why do elephants face the threat of extinction while cows do not?
a. Cattle are a valuable source of income for many people, while elephants have no market value.
b. There is a high demand for products that come from cows, whereas there is no demand for products that come from elephants.
c. There are still lots of cattle that roam free, while all elephants live in zoos.
d. Cattle are owned by ranchers, while elephants are owned by no one
answer
d. Cattle are owned by ranchers, while elephants are owned by no one
question
When property rights are not well established,
a. private goods become public goods.
b. markets fail to allocate resources efficiently.
c. the distribution of private goods is unfair.
d. government resources are used inefficiently.
answer
b. markets fail to allocate resources efficiently.
question
b. 2 streetlights
answer
Refer to Table 11-2. Suppose the cost to install each streetlight is $900 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?"
a. 1 streetlight
b. 2 streetlights
c. 3 streetlights
d. 4 streetlights
question
When a good is excludable,
a. one person's use of the good diminishes another person's ability to use it.
b. people can be prevented from using the good.
c. no more than one person can use the good at the same time.
d. everyone will be excluded from using the good.
answer
b. people can be prevented from using the good.
question
d. Box D, which represents public goods.
answer
Refer to Figure 11-1. Emma's use of good x does not affect anyone else's use of good x. Neither Emma nor anyone else can be prevented from using the good. Good x is an example of the type of good that belongs in
a. Box A, which represents private goods.
b. Box B, which represents common resources.
c. Box C, which represents common resources.
d. Box D, which represents public goods.
question
The Tragedy of the Commons will be evident when a growing number of sheep grazing on the town commons leads to a destruction of the grazing resource. To correct for this problem, the town could
a. allow individual shepherds to choose their own flock sizes.
b. internalize the externality by subsidizing the production of sheep's wool.
c. auction off a limited number of sheep-grazing permits.
d. wait until the market corrects the problem.
answer
c. auction off a limited number of sheep-grazing permits.
question
The U.S. government protects fish, a common resource, by
a. subsidizing the fishing industry.
b. heavily taxing competing industries.
c. selling fishing licenses and regulating fish lengths.
d. None of the above is correct.
answer
c. selling fishing licenses and regulating fish lengths.
