Question 1

Water supply problems are widespread,indicating that

Accepted Answer

A) water markets can seldom work,because water Is a necessity. 
B) property rights are frequently incomplete and not fully tradable. 
C) water is too important to ration by price. 
D) water markets are seldom controlled by government. 
A) water markets can seldom work,because water Is a necessity. 
B) property rights are frequently incomplete and not fully tradable. 
C) water is too important to ration by price. 
D) water markets are seldom controlled by government.

Question 2

Data on world reserves of minerals,gathered by Blackman and Baumol,show that between 1950 and 2000,production of most minerals

Accepted Answer

A) greatly exceeded the reserves available in 1950. 
B) declined as depletion occurred. 
C) greatly reduced the reserves available in 2000. 
D) was limited to a fraction of the reserves available in 1950. 
A) greatly exceeded the reserves available in 1950. 
B) declined as depletion occurred. 
C) greatly reduced the reserves available in 2000. 
D) was limited to a fraction of the reserves available in 1950.

Question 3

Suppose that new demands greatly reduce the proved reserves of titanium to unexpectedly low levels,and it appears that the new demands will continue.If the market price is unregulated,we should expect that the price will rise and

Accepted Answer

A) increase exploration and encourage more effective recovery methods,resulting in additional new supplies of titanium. 
B) encourage consumers and manufacturers to conserve titanium. 
C) increase the incentive to find and use substitutes for titanium. 
D) All of the above. 
A) increase exploration and encourage more effective recovery methods,resulting in additional new supplies of titanium. 
B) encourage consumers and manufacturers to conserve titanium. 
C) increase the incentive to find and use substitutes for titanium. 
D) All of the above.

Question 4

Suppose that new demands greatly reduce the proved reserves of titanium to unexpectedly low levels,and it appears that the new demands will continue.If the market price is unregulated,we should expect that the price will

Accepted Answer

A) rise sharply,calling forth added exploration and more effective (and more costly)recovery methods,resulting in additional new supplies of titanium. 
B) rise sharply,calling forth new ways for manufacturers to conserve titanium and to find substitutes for it. 
C) over time,bring the quantity supplied of titanium into balance with the quantity demanded. 
D) do all of the above. 
A) rise sharply,calling forth added exploration and more effective (and more costly)recovery methods,resulting in additional new supplies of titanium. 
B) rise sharply,calling forth new ways for manufacturers to conserve titanium and to find substitutes for it. 
C) over time,bring the quantity supplied of titanium into balance with the quantity demanded. 
D) do all of the above.

Question 5

Predictions that natural resources such as oil will be essentially used up in the next few decades have

Accepted Answer

A) been frequently made for the past century,but have always proven to be false. 
B) usually been based on the quantity of proved reserves. 
C) ignored the role of price in governing the quantities demanded and supplied. 
D) All of the above. 
A) been frequently made for the past century,but have always proven to be false. 
B) usually been based on the quantity of proved reserves. 
C) ignored the role of price in governing the quantities demanded and supplied. 
D) All of the above.

Question 6

An example of a renewable resource is

Accepted Answer

A) coal. 
B) oil. 
C) timber. 
D) diamonds. 
A) coal. 
B) oil. 
C) timber. 
D) diamonds.

Question 7

What happens to a resource as it becomes scarcer?

Accepted Answer

A) The price rises and this increases the future supply relative to demand. 
B) The price rises and this increases the future demand relative to supply. 
C) The price falls and this increases the future supply relative to demand. 
D) The price falls and this increases the future demand relative to supply. 
A) The price rises and this increases the future supply relative to demand. 
B) The price rises and this increases the future demand relative to supply. 
C) The price falls and this increases the future supply relative to demand. 
D) The price falls and this increases the future demand relative to supply.

Question 8

Resource markets are like any other market in that

Accepted Answer

A) the increase in quantity supplied in response to a higher price will generally be greater in the long run than in the short run. 
B) the amount demanded of a resource is inversely related to its price. 
C) higher prices encourage people to search for substitutes. 
D) all of the above are correct. 
A) the increase in quantity supplied in response to a higher price will generally be greater in the long run than in the short run. 
B) the amount demanded of a resource is inversely related to its price. 
C) higher prices encourage people to search for substitutes. 
D) all of the above are correct.

Question 9

Water shortages are usually the result of

Accepted Answer

A) profit-seeking owners of the resource holding water off the market and refusing to trade. 
B) bad forecasts by water planners. 
C) monopoly fixing of water prices. 
D) a lack of tradeable property rights in water. 
A) profit-seeking owners of the resource holding water off the market and refusing to trade. 
B) bad forecasts by water planners. 
C) monopoly fixing of water prices. 
D) a lack of tradeable property rights in water.

Question 10

In the Central Utah Project,the water delivered from dams to users

Accepted Answer

A) is very well utilized,because planners allocated water to its highest valued uses and users. 
B) cannot generally be traded,so is often wastefully used in low-valued uses. 
C) is often sold to water-short cities by farmers who can then enjoy a profit from the sale. 
D) is very expensive to the users who get it. 
A) is very well utilized,because planners allocated water to its highest valued uses and users. 
B) cannot generally be traded,so is often wastefully used in low-valued uses. 
C) is often sold to water-short cities by farmers who can then enjoy a profit from the sale. 
D) is very expensive to the users who get it.

Question 11

Resources that are not created or renewed at a significant rate,and therefore could potentially be used up over time,are called

Accepted Answer

A) renewable resources. 
B) nonrenewable resources. 
C) fixed resources. 
D) earthly geographic resources. 
A) renewable resources. 
B) nonrenewable resources. 
C) fixed resources. 
D) earthly geographic resources.

Question 12

Compared with 1920,the United States today has

Accepted Answer

A) far less forest land. 
B) far more forest land. 
C) about the same amount of forest land. 
D) far fewer trees growing per acre of forest land. 
A) far less forest land. 
B) far more forest land. 
C) about the same amount of forest land. 
D) far fewer trees growing per acre of forest land.

Question 13

When natural resources are not traded,or where markets are not allowed to function as well as they can under a system of well-defined property rights,the problems of ____ and ____ are common.

Accepted Answer

A) higher taxes;increased regulation 
B) waste;scarcity 
C) inflation;unemployment 
D) slow growth;fluctuating currency values 
A) higher taxes;increased regulation 
B) waste;scarcity 
C) inflation;unemployment 
D) slow growth;fluctuating currency values

Question 14

If the prices of energy products rise sharply,consumers will most likely

Accepted Answer

A) sharply reduce their consumption of these products in both the short run and the long run. 
B) reduce their consumption of these products slightly in the short run and more sharply in the long run. 
C) reduce their consumption of these products sharply in the short run,but in the long run consumption will fall by only a small amount. 
D) increase their consumption of these products slightly in the short run and more sharply in the long run. 
A) sharply reduce their consumption of these products in both the short run and the long run. 
B) reduce their consumption of these products slightly in the short run and more sharply in the long run. 
C) reduce their consumption of these products sharply in the short run,but in the long run consumption will fall by only a small amount. 
D) increase their consumption of these products slightly in the short run and more sharply in the long run.

Question 15

When the price of gasoline increases substantially,many consumers will

Accepted Answer

A) turn to fuel saving alternatives like hybrid vehicles. 
B) drive less. 
C) take public transportation. 
D) all of the above are true. 
A) turn to fuel saving alternatives like hybrid vehicles. 
B) drive less. 
C) take public transportation. 
D) all of the above are true.

Question 16

The influence of agricultural technologies on farm land in the United States has been

Accepted Answer

A) very little up until now. 
B) substantial,as greater productivity per acre reduced the need for farmland. 
C) substantial;the productivity of much farm land has been destroyed by new technologies and may never be useful again. 
D) to make farmland less productive over time as the minerals In the soil are used up. 
A) very little up until now. 
B) substantial,as greater productivity per acre reduced the need for farmland. 
C) substantial;the productivity of much farm land has been destroyed by new technologies and may never be useful again. 
D) to make farmland less productive over time as the minerals In the soil are used up.

Question 17

The concept of "proved reserves" refers to the amount of a resource that can be produced

Accepted Answer

A) in one year's time. 
B) in the next ten years. 
C) before it runs out. 
D) at current prices and technology. 
A) in one year's time. 
B) in the next ten years. 
C) before it runs out. 
D) at current prices and technology.

Question 18

In the United States,water purchases from the government

Accepted Answer

A) always cover the costs of water delivery. 
B) are often subsidized for the user of water. 
C) are not subsidized,because that would be inefficient. 
D) almost never occur. 
A) always cover the costs of water delivery. 
B) are often subsidized for the user of water. 
C) are not subsidized,because that would be inefficient. 
D) almost never occur.

Question 19

Since 1950,the price of crude oil,corrected for inflation,has

Accepted Answer

A) gone steadily upward. 
B) generally declined,with brief price spikes upward in 1973 and 1987. 
C) showed one peak in the early 1980s and another substantial rise after 2000,but otherwise showed little trend. 
D) changed very little,in real terms. 
A) gone steadily upward. 
B) generally declined,with brief price spikes upward in 1973 and 1987. 
C) showed one peak in the early 1980s and another substantial rise after 2000,but otherwise showed little trend. 
D) changed very little,in real terms.

Question 20

Researcher Terry Anderson claims that with respect to the supply of water,trading it would be

Accepted Answer

A) wrong and counter-productive. 
B) essentially impossible due to lack of technologies to move the water. 
C) highly productive and bring cooperation among the traders. 
D) a problem,since monopolists would come to own too much. 
A) wrong and counter-productive. 
B) essentially impossible due to lack of technologies to move the water. 
C) highly productive and bring cooperation among the traders. 
D) a problem,since monopolists would come to own too much.

Exam 41: The Question of Resource Exhaustion

Water supply problems are widespread,indicating that

Data on world reserves of minerals,gathered by Blackman and Baumol,show that between 1950 and 2000,production of most minerals

Suppose that new demands greatly reduce the proved reserves of titanium to unexpectedly low levels,and it appears that the new demands will continue.If the market price is unregulated,we should expect that the price will rise and

Suppose that new demands greatly reduce the proved reserves of titanium to unexpectedly low levels,and it appears that the new demands will continue.If the market price is unregulated,we should expect that the price will

Predictions that natural resources such as oil will be essentially used up in the next few decades have

An example of a renewable resource is

What happens to a resource as it becomes scarcer?

Resource markets are like any other market in that

Water shortages are usually the result of

In the Central Utah Project,the water delivered from dams to users

Resources that are not created or renewed at a significant rate,and therefore could potentially be used up over time,are called

Compared with 1920,the United States today has

When natural resources are not traded,or where markets are not allowed to function as well as they can under a system of well-defined property rights,the problems of ____ and ____ are common.

If the prices of energy products rise sharply,consumers will most likely

When the price of gasoline increases substantially,many consumers will

The influence of agricultural technologies on farm land in the United States has been

The concept of "proved reserves" refers to the amount of a resource that can be produced

In the United States,water purchases from the government

Since 1950,the price of crude oil,corrected for inflation,has

Researcher Terry Anderson claims that with respect to the supply of water,trading it would be

The Economic Approach

Asome Tools of the Economist

Asupply,demand,and the Market Process

Asupply and Demand: Applications and Extensions

Difficult Cases for the Market and the Role of Government

The Economics of Collective Decision-Making

Ataking the Nations Economic Pulse

Economic Fluctuations, unemployment, and Inflation

Aan Introduction to Basic Macroeconomic Markets

Dynamic Change, economic Fluctuations, and the Ad-As Model

Fiscal Policy: the Keynesian View and Historical Perspective

Fiscal Policy, incentives, and Secondary Effects

Amoney and the Banking System

Modern Macroeconomics and Monetary Policy

Stabilization Policy, output, and Employment

Creating an Environment for Growth and Prosperity

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Gaining From International Trade

International Finance and the Foreign Exchange Market

Consumer Choice and Elasticity

Acosts and the Supply of Goods

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Price-Searcher Markets With Low Entry Barriers

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The Supply of and Demand for Productive Resources

Earnings, productivity, and the Job Market

Investment, the Capital Market, and the Wealth of Nations

Income Inequality and Poverty

Government Spending and Taxation

The Economics of Social Security

The Stock Market: Its Function, Performance, and Potential As an Investment Opportunity

Great Debates in Economics: Keynes Versus Hayek

The Crisis of 2008: Causes and Lessons for the Future

Lessons From the Great Depression

Lessons From Japan and Canada

The Federal Budget and the National Debt

The Economics of Healthcare

Education: Problems and Performance

Earnings Differences Between Men and Women

Do Labor Unions Increase the Wages of Workers

Difficult Environmental Cases and the Role of Government

Filters

When natural resources are not traded,or where markets are not allowed to function as well as they can under a system of well-defined property rights,the problems of and are common.