Question 1

The economy's marginal social benefit curve for a public good is calculated by adding the

Accepted Answer

A)  marginal cost of all the suppliers at each quantity. 
B)  quantities supplied by all the suppliers at each price. 
C)  quantities demanded by all the individuals at each price. 
D)  marginal benefits of all the individuals at each quantity. 
A)  marginal cost of all the suppliers at each quantity. 
B)  quantities supplied by all the suppliers at each price. 
C)  quantities demanded by all the individuals at each price. 
D)  marginal benefits of all the individuals at each quantity.

Question 2

If a public good was left to be provided by the private sector

Accepted Answer

A)  more than the efficient quantity would be produced. 
B)  less than the efficient quantity would be produced 
C)  the efficient quantity would be produced 
D)  the good would be provided at a very low price. 
A)  more than the efficient quantity would be produced. 
B)  less than the efficient quantity would be produced 
C)  the efficient quantity would be produced 
D)  the good would be provided at a very low price.

Question 3

Katie Bobby
  
-The above table shows the marginal benefit from submarines for the only two citizens of a country. Submarines are a public good. If submarines cost $25 a piece to produce, who would vote for the purchase of four submarines?

Accepted Answer

A)  both Katie and Bobby 
B)  Katie only 
C)  Bobby only 
D)  nobody 
A)  both Katie and Bobby 
B)  Katie only 
C)  Bobby only 
D)  nobody

Question 4

-Mike, Joe, and Sam are roommates. They need lamps for their common living room. Lamps in their living room are a public good for these roommates. The marginal benefit that each individual receives from varying numbers of lamps in the living room is given in the table above. If the marginal cost of a lamp is 9, what is the efficient number of lamps for the roommates to purchase?

Accepted Answer

A)  1 
B)  2 
C)  3 
D)  4 
A)  1 
B)  2 
C)  3 
D)  4

Question 5

To find the economy's marginal benefit curve for a public good, you would

Accepted Answer

A)  average the individual marginal benefit curves horizontally. 
B)  average the individual marginal benefit curves vertically. 
C)  sum the individual marginal benefit curves horizontally. 
D)  sum the individual marginal benefit curves vertically. 
A)  average the individual marginal benefit curves horizontally. 
B)  average the individual marginal benefit curves vertically. 
C)  sum the individual marginal benefit curves horizontally. 
D)  sum the individual marginal benefit curves vertically.

Question 6

-Tom and Jerry are the only members of society. The table above shows their marginal benefits from defense satellites, a public good. If the marginal social cost of a satellite is $36, the efficient quantity of satellites is

Accepted Answer

A)  1. 
B)  2. 
C)  3. 
D)  4. 
A)  1. 
B)  2. 
C)  3. 
D)  4.

Question 7

Natural monopolies are ________ and ________.

Accepted Answer

A)  rival; excludable 
B)  nonrival; excludable 
C)  rival; nonexcludable 
D)  nonrival; nonexcludable 
A)  rival; excludable 
B)  nonrival; excludable 
C)  rival; nonexcludable 
D)  nonrival; nonexcludable

Question 8

A common resource is ________ and ________.

Accepted Answer

A)  rival; excludable 
B)  nonrival; excludable 
C)  rival; nonexcludable 
D)  nonrival; nonexcludable 
A)  rival; excludable 
B)  nonrival; excludable 
C)  rival; nonexcludable 
D)  nonrival; nonexcludable

Question 9

In an unregulated market for healthcare, the equilibrium quantity is that at which ________ and the efficient quantity is that at which ________.

Accepted Answer

A)  D = S; MB = MSC 
B)  D = S; MSB = MSC 
C)  D = MSC; MB = MSC 
D)  MSB = S; MB = S 
A)  D = S; MB = MSC 
B)  D = S; MSB = MSC 
C)  D = MSC; MB = MSC 
D)  MSB = S; MB = S

Question 10

If the consumption of Good A by one person does NOT decrease the quantity of Good A available for another person's consumption, then the good is said to be

Accepted Answer

A)  nonrival. 
B)  rival. 
C)  nonexcludable. 
D)  excludable. 
A)  nonrival. 
B)  rival. 
C)  nonexcludable. 
D)  excludable.

Question 11

-The graph shows costs and benefits of a mosquito control program, which is a public good:
a) What is the quantity of spraying that achieves efficiency?
b) What is the political equilibrium if voters are well informed?

Accepted Answer

a) Efficiency is reached at the quantity

Question 12

Public goods are

Accepted Answer

A)  under provided by the private market because the marginal cost of production is too high. 
B)  under provided by the private market because the marginal benefits of consumption are too low. 
C)  under provided by the private market because people's willingness to pay for the good is less than the marginal benefit of the good. 
D)  over provided by the private market because the marginal benefits of consumption are too high. 
A)  under provided by the private market because the marginal cost of production is too high. 
B)  under provided by the private market because the marginal benefits of consumption are too low. 
C)  under provided by the private market because people's willingness to pay for the good is less than the marginal benefit of the good. 
D)  over provided by the private market because the marginal benefits of consumption are too high.

Question 13

Long Beach Island, off the coast of New Jersey, is considering enhancing its system of satellite towers to help communication during emergencies such as hurricanes. A study showed that in Superstorm Sandy the existing number of satellite towers resulted in the marginal social cost of a satellite tower being less than the marginal social benefit. To achieve efficiency, this study indicates that the

Accepted Answer

A)  system should be left as is because the quantity of satellite towers is efficient. 
B)  system should be reduced in size because the quantity of satellite towers is more than the efficient quantity. 
C)  system should be expanded because the quantity of satellite towers is less than the efficient quantity. 
D)  None of the above because the study erred in comparing the marginal social cost to the marginal social benefit since it should have compared the marginal private cost to the marginal private benefit. 
A)  system should be left as is because the quantity of satellite towers is efficient. 
B)  system should be reduced in size because the quantity of satellite towers is more than the efficient quantity. 
C)  system should be expanded because the quantity of satellite towers is less than the efficient quantity. 
D)  None of the above because the study erred in comparing the marginal social cost to the marginal social benefit since it should have compared the marginal private cost to the marginal private benefit.

Question 14

A free rider is a person who consumes a good without paying for it.

Accepted Answer

A) True 
 B)False

Question 15

An example of a good that is both rival and excludable is

Accepted Answer

A)  the defense services provided by a new stealth bomber. 
B)  a pair of pants. 
C)  a beautiful sunset. 
D)  an uncrowded theme park such as Walt Disney World. 
A)  the defense services provided by a new stealth bomber. 
B)  a pair of pants. 
C)  a beautiful sunset. 
D)  an uncrowded theme park such as Walt Disney World.

Question 16

Which of the following is a characteristic of a public good? The good is

Accepted Answer

A)  excludable. 
B)  nonrival. 
C)  nonexcludable. 
D)  Both answers B and C are correct. 
A)  excludable. 
B)  nonrival. 
C)  nonexcludable. 
D)  Both answers B and C are correct.

Question 17

Which of the following is the BEST example of a public good?

Accepted Answer

A)  a can of Mountain Dew 
B)  fish in the ocean 
C)  cable television 
D)  national defense 
A)  a can of Mountain Dew 
B)  fish in the ocean 
C)  cable television 
D)  national defense

Question 18

Some resources are private and others are common. Define a common resource, explain the definition, and provide an example of a private resource and a common resource.

Accepted Answer

A common resource is rival and nonexclud

Question 19

Katie Bobby
  
-The above table shows the marginal benefit from submarines for the only two citizens of a country. Suppose submarines cost $175 a piece. Politician A proposes 2 submarines while politician B proposes 4. Assuming that both Bobby and Katie pay one half of the resulting taxes and neither is rationally ignorant, which politician will win the election?

Accepted Answer

A)  A because she offers voters a lower tax bill. 
B)  A because she offers voters a greater net benefit. 
C)  B because she offers voters a greater total benefit. 
D)  B because she offers voters more submarines. 
A)  A because she offers voters a lower tax bill. 
B)  A because she offers voters a greater net benefit. 
C)  B because she offers voters a greater total benefit. 
D)  B because she offers voters more submarines.

Question 20

Because of the free-rider problem

Accepted Answer

A)  there is an efficient allocation of resources for common resources. 
B)  private provision leads to the production of more than the efficient quantity of a public good. 
C)  private provision leads to the production of less than the efficient quantity of a public good. 
D)  the public uses too little of a common resource. 
A)  there is an efficient allocation of resources for common resources. 
B)  private provision leads to the production of more than the efficient quantity of a public good. 
C)  private provision leads to the production of less than the efficient quantity of a public good. 
D)  the public uses too little of a common resource.

The economy's marginal social benefit curve for a public good is calculated by adding the

If a public good was left to be provided by the private sector

Katie Bobby -The above table shows the marginal benefit from submarines for the only two citizens of a country. Submarines are a public good. If submarines cost $25 a piece to produce, who would vote for the purchase of four submarines?

To find the economy's marginal benefit curve for a public good, you would

-Tom and Jerry are the only members of society. The table above shows their marginal benefits from defense satellites, a public good. If the marginal social cost of a satellite is $36, the efficient quantity of satellites is

Natural monopolies are and .

A common resource is and .

In an unregulated market for healthcare, the equilibrium quantity is that at which and the efficient quantity is that at which .

If the consumption of Good A by one person does NOT decrease the quantity of Good A available for another person's consumption, then the good is said to be

-The graph shows costs and benefits of a mosquito control program, which is a public good: a) What is the quantity of spraying that achieves efficiency? b) What is the political equilibrium if voters are well informed?

Public goods are

A free rider is a person who consumes a good without paying for it.

An example of a good that is both rival and excludable is

Which of the following is a characteristic of a public good? The good is

Which of the following is the BEST example of a public good?

Some resources are private and others are common. Define a common resource, explain the definition, and provide an example of a private resource and a common resource.

Because of the free-rider problem

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters

Exam 16: Public Choices, Public Goods, and Healthcare

The economy's marginal social benefit curve for a public good is calculated by adding the

If a public good was left to be provided by the private sector

Katie Bobby -The above table shows the marginal benefit from submarines for the only two citizens of a country. Submarines are a public good. If submarines cost $25 a piece to produce, who would vote for the purchase of four submarines?

To find the economy's marginal benefit curve for a public good, you would

-Tom and Jerry are the only members of society. The table above shows their marginal benefits from defense satellites, a public good. If the marginal social cost of a satellite is $36, the efficient quantity of satellites is

Natural monopolies are ________ and ________.

A common resource is ________ and ________.

In an unregulated market for healthcare, the equilibrium quantity is that at which ________ and the efficient quantity is that at which ________.

If the consumption of Good A by one person does NOT decrease the quantity of Good A available for another person's consumption, then the good is said to be

-The graph shows costs and benefits of a mosquito control program, which is a public good: a) What is the quantity of spraying that achieves efficiency? b) What is the political equilibrium if voters are well informed?

Public goods are

A free rider is a person who consumes a good without paying for it.

An example of a good that is both rival and excludable is

Which of the following is a characteristic of a public good? The good is

Which of the following is the BEST example of a public good?

Some resources are private and others are common. Define a common resource, explain the definition, and provide an example of a private resource and a common resource.

Because of the free-rider problem

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters

Natural monopolies are and .

A common resource is and .

In an unregulated market for healthcare, the equilibrium quantity is that at which and the efficient quantity is that at which .