Exam 15: Public Goods and Public Choice

Suppose Patty has a house in a good neighborhood in Philadelphia.She decides to have the exterior of her house painted and the windows replaced.After the work is completed,her house has appreciated in value and has also helped her neighbors' houses to go up in value.This is an example of a

Which of the following situations contains most of the characteristics of a private good?

Giving contributors a small gift is one way to overcome the free-rider problem.

A politician might pursue his own interest even though it may differ from the public interest.

The private market does NOT provide national defense because

List three ways in which an organization can overcome the free-rider problem.

Due to crime externalities,a more educated society tends to have a lower level of crime.

The model of government based on small groups of people manipulating government for their own gain is

Public goods are

The government can offer a subsidy that encourages people to seek more education.

In a two-party democratic system,individuals running for office typically

Give an example where individuals "vote with their feet" in choosing among bundles of public goods and tax rates.

The ________ problem of public goods occurs because people can enjoy the benefits of these goods even when they do not have to pay for them.

Recall the example about the dam and the farmers.The cost of building the dam is spread among a small special interest group (farmers)and the benefit is obtained by the taxpayers.

An individual would choose the number of news articles to read based on her

Due to the existence of external benefits associated with public goods,

A free rider is a person who

List the two characteristics that define a public good.

Which of the following is true?

Public goods