Exam 17: Externalities

-The above table shows the marginal benefits and costs from production of fertilizer. There are no external benefits. If the market is perfectly competitive and unregulated, the equilibrium output will be

-Using the above figure, in the absence of any government intervention, the number of tons of paper produced will be

If the production of a good creates an external cost, is the supply curve the same as the marginal social cost or the same as the marginal private cost curve or both?

To eliminate the inefficiency resulting from an external cost of production, the government can impose a tax on producers that is equal to the

-The above figure shows the marginal private benefit and marginal social cost of a college education. If society's external benefits from college graduates is $10,000 each, then the private market outcome is inefficient because

When a production quota is used to remedy the problem of the commons, then

The benefit from an additional unit of a good or service that people other than the consumer of that good or service receives is the

Which of the following illustrates the concept of external benefit?

When people decorate the exteriors of their homes with colored lights, they create ________ for the motorists who pass by.

-The table above shows the marginal private benefit, marginal social benefit, and marginal cost of education at the College of Epsilon. What is the efficient number of students at the college?

-The above table shows the marginal benefits and costs from production of fertilizer. There are no external benefits. The efficient level of output is

-In the figure above, if the market is unregulated, the output will be

-The figure above shows the costs associated with producing paper. When paper is produced, there is some pollution runoff into a lake. The marginal private cost borne by the firms plus the people who enjoy a clean lake when output equals 2 tons of paper per week equals

When the marginal social benefit of Good A is greater than the marginal private benefit of Good A, then

-The table above describes the market for paper. The production of paper produces pollution. There are no external benefits. What amount of tax per ton of paper is necessary to produce the efficient quantity of paper?

-The tables above show the marginal costs and benefits from production and consumption of paper. From this information we can see that there are

-Suppose Motorland's government imposes a tax of $1.50 per gallon of gasoline sold. With the tax, the market will

The Coase Theorem points out that externality problems can be eliminated if the number of parties involved is small and if property rights

In the absence of property rights, factories will dump waste into a waterway up to the point where ________ equals ________.

"External benefits lead to overproduction so that more than the efficient quantity is produced." Is the previous statement true or false?