Exam 19: Natural Resource and Energy Economics

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

Rapid population growth since 1800 has occurred primarily because of

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

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

Individual transferable quotas are limited in their effectiveness because

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

Global resource demand has

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

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

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

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?

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

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?

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

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

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

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

Forestry companies typically harvest and replant an area when trees are

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

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,