Exam 13: Positive Externalities and Public Goods

Cathy can take either of two separate roads to drive to work. The first is a lightly used new toll road that is rarely congested. The second road is a local road with no tolls, but it is often congested and has many potholes. In this instance, the toll road is

For a positive externality, _______ than the social benefits.

Which of the following represents one of the methods that the government uses to promote technology?

Briefly explain what is meant by the term "nonexcludable".

Which of the following would most likely be identified as being the ultimate goal of public policies that pertain to technology?

ToasterOvensInc. is developing technology to make a toaster oven than uses less electricity. If successful, the technology will significantly reduce the amount of energy that is wasted due to product inefficiencies. If the firm sells only in response to the market price, the quantity shown in the third column is supplied. If the firm were also to receive the broader social benefits of the new technology, the willingness to supply is shown in the fourth column. If the firm were to receive a price based on both private and social benefits, the equilibrium price and quantity would be

An individual who wants others to pay for public goods, but plans to use those goods for their own purposes, is often referred to as a _______.

The term "applied research" refers to research that is focused on a particular product that promises

If the government altered its invention patent policy from a monopolistic policy to a competitive policy, then consumers

Under current U.S. copyright legislation, works produced on a for-hire basis and owned by firms enjoy monopoly protection for

If a small electric automobile manufacturer is able to gain the social return generated by its electric motor, its demand for financial capital would

If the research and development efforts of a firm have ended in failure, then

Market competition may sometimes encourage a firm to innovate out of fear because of the perception that

Briefly explain what is meant by the term "nonrivalrous".

A public good is a good that is _______, and thus is difficult for market producers to sell to individual consumers.

ToasterOvensInc. is developing technology to make a toaster oven than uses less electricity. If successful, the technology will significantly reduce the amount of energy that is wasted due to product inefficiencies. If the firm sells only in response to the market price, the quantity shown in the third column of the table below is supplied. If the firm were also to receive the broader social benefits of the new technology, the willingness to supply is shown in the fourth column. If the firm were to receive a price based only on private benefits, the equilibrium price and quantity would be

Why did Thomas Edison vow that he would work only on ideas for things that people would buy?

Discuss the difficulty government may experience direct support for R&D and explain a complimentary approach that is used as an alternative.

For a negative externality, the _______ than the costs imposed on society as a whole.

Many economists would view market competition as supporting the invention of new technology because it