Exam 15: Public Goods, Externalities, and Government Behavior

Which of the following properly compares/contrasts government and markets?

To correct a positive externality problem, the government can impose

The government can internalize externalities by producing the goods itself.

Prior to the selling of the radio spectrum, frequency rights were obtained through

Why does the median voter tend to control policy in a democratic system?

With market-based incentives in government, rules and regulations will disappear.

Why do special interest groups have a disproportionate amount of influence compared to voters in general?

When a positive externality exists in the production of a good,

If government uses taxation to correct for negative externalities, the desired consequence is

Contingent valuations give the most reliable estimate of the marginal benefits of a public good.

Modern technology is constantly changing the degree to which particular goods exhibit nonrivalry and nonexcludability.

To correct a negative externality problem, the government can impose

The role of government in tradable permit markets is to control how firms buy and sell the permits.

A Republican candidate appeals to a very conservative group of voters in order to obtain his party's nomination for president. Explain why this tactic might cause this candidate to lose the presidential election.

A private agreement between bargainers may not take place because of

A society can sometimes alleviate problems caused by externalities by

A positive externality occurs when one person's activity makes another person better off.

A private firm would have difficulty producing and selling

Exhibit 15-3 -Exhibit 15-3 shows the preference rankings of voters Tom, Dick, and Harry for policies A, B, and C. If an election were held between policy B and policy C, which voter or voters would vote for policy C?

If a good's production process results in pollution and the government taxes producers to pay for cleanup costs, then