Question 1

Public goods can be

Accepted Answer

A) provided privately. 
B) provided publicly. 
C) subject to free rider problems. 
D) all of the above. 
A) provided privately. 
B) provided publicly. 
C) subject to free rider problems. 
D) all of the above. D

Question 2

When asked to reveal their true preferences people

Accepted Answer

A) always tell the truth. 
B) never tell the truth. 
C) sometimes tell the truth. 
D) generally don't know what preferences are. 
A) always tell the truth. 
B) never tell the truth. 
C) sometimes tell the truth. 
D) generally don't know what preferences are. C

Question 3

Commodity egalitarianism refers to commodities that

Accepted Answer

A) are important for most consumers. 
B) are too dangerous for most consumers. 
C) should be made available to all consumers. 
D) are good ideas but never produced. 
A) are important for most consumers. 
B) are too dangerous for most consumers. 
C) should be made available to all consumers. 
D) are good ideas but never produced. C

Question 4

Market mechanisms are unlikely to provide

Accepted Answer

A) prices. 
B) nonrival goods efficiently. 
C) supply and demand. 
D) none of the above. 
A) prices. 
B) nonrival goods efficiently. 
C) supply and demand. 
D) none of the above.

Question 5

Demand curves for pure public goods satisfy the law of demand.

Accepted Answer

A) True 
 B)False

Question 6

The MRT is

Accepted Answer

A) the marginal ring tone. 
B) the minimal rate of time. 
C) the maximum rate of transformation. 
D) none of the above. 
A) the marginal ring tone. 
B) the minimal rate of time. 
C) the maximum rate of transformation. 
D) none of the above.

Question 7

Figure 4.3
-From Figure 4.3 ,the market price of rockets is

Accepted Answer

A) 10. 
B) 4. 
C) 6. 
D) 20. 
A) 10. 
B) 4. 
C) 6. 
D) 20.

Question 8

Public goods are characterized by

Accepted Answer

A) nonrivalness. 
B) excludability. 
C) the sum of the MRSs equaling MRT. 
D) all of the above. 
A) nonrivalness. 
B) excludability. 
C) the sum of the MRSs equaling MRT. 
D) all of the above.

Question 9

Vertical summation of demand curves yield results equivalent to those of horizontal summation.

Accepted Answer

A) True 
 B)False

Question 10

Discuss and contrast the advantages and disadvantages of public highways versus toll roads.

Accepted Answer

There would be less uniformity

Question 11

Which of the following is a public good?

Accepted Answer

A) public defense 
B) public television 
C) a library 
D) schools 
E) all of the above 
A) public defense 
B) public television 
C) a library 
D) schools 
E) all of the above

Question 12

Increasing the quantity of a pure public good can be done at zero cost.

Accepted Answer

A) True 
 B)False

Question 13

A private good is

Accepted Answer

A) nonrival in consumption. 
B) subject to free rider problems. 
C) not subject to exclusion. 
D) subject to exclusion. 
A) nonrival in consumption. 
B) subject to free rider problems. 
C) not subject to exclusion. 
D) subject to exclusion.

Question 14

School vouchers are

Accepted Answer

A) provided by the government. 
B) provided by private organizations. 
C) public funds to be used for private tuition. 
D) all of the above. 
A) provided by the government. 
B) provided by private organizations. 
C) public funds to be used for private tuition. 
D) all of the above.

Question 15

Suppose there are two individuals with identical demand curves characterized by the equation P = 2 - Q.What is market demand if these demand curves are added horizontally? Vertically?

Accepted Answer

Horizontal adding yi

Question 16

Charging individual prices that are based on consumers' willingness to pay is

Accepted Answer

A) government price supports. 
B) will pricing. 
C) second tier pricing. 
D) price discrimination. 
A) government price supports. 
B) will pricing. 
C) second tier pricing. 
D) price discrimination.

Question 17

You have read that the free rider problem affects equilibrium in a public good context.Explain how this situation can be modeled as a prisoner's dilemma game.

Accepted Answer

Each individual will say before construc

Question 18

"Discussion Questions" number 11
Suppose that there are only two fishermen,Zach and Jacob, who fish along a certain coast. They would each benefit if lighthouses were built along the coast where they fish. The marginal cost of building each additional lighthouse is $100. The marginal benefit to Zach of each additional lighthouse is 90 − Q , and the marginal benefit to Jacob is 40 − Q, where Q equals the number of lighthouses.
a. Explain why we might not expect to find the efficient number of lighthouses along this coast.
b. What is the efficient number of lighthouses? What would be the net benefits to Zach and Jacob if the efficient number were provided? 
-Refer to "Discussion Questions" number 11 .How does your answer change if the marginal cost of building each additional lighthouse increases to $150?

Accepted Answer

Part a)stays the same.Part b)n

Question 19

Pure private goods are nonrival in consumption.

Accepted Answer

A) True 
 B)False

Question 20

Suppose you are given the following demand curves: Q = 32 - P and Q = 16 - (P/2).Add these two demand curves vertically and find the market demand curve.

Accepted Answer

The demand curve has two porti

Exam 4: Public Goods

Public goods can be

When asked to reveal their true preferences people

Commodity egalitarianism refers to commodities that

Market mechanisms are unlikely to provide

Demand curves for pure public goods satisfy the law of demand.

The MRT is

Figure 4.3 -From Figure 4.3 ,the market price of rockets is

Public goods are characterized by

Vertical summation of demand curves yield results equivalent to those of horizontal summation.

Discuss and contrast the advantages and disadvantages of public highways versus toll roads.

Which of the following is a public good?

Increasing the quantity of a pure public good can be done at zero cost.

A private good is

School vouchers are

Suppose there are two individuals with identical demand curves characterized by the equation P = 2 - Q.What is market demand if these demand curves are added horizontally? Vertically?

Charging individual prices that are based on consumers' willingness to pay is

You have read that the free rider problem affects equilibrium in a public good context.Explain how this situation can be modeled as a prisoner's dilemma game.

Pure private goods are nonrival in consumption.

Suppose you are given the following demand curves: Q = 32 - P and Q = 16 - (P/2).Add these two demand curves vertically and find the market demand curve.

Introduction

Tools of Positive Analysis

Tools of Normative Analysis

Externalities

Political Economy

Education

Cost-Benefit Analysis

The Health Care Market

Government and the Market for Health Care

Social Security

Income Redistribution: Conceptual Issues

Expenditure Programs for the Poor

Taxation and Income Distribution

Taxation and Efficiency

Efficient and Equitable Taxation

The Personal Income Tax

Personal Taxation and Behavior

The Corporation Tax

Deficit Finance

Fundamental Tax Reform: Taxes on Consumption and Wealth

Public Finance in a Federal System

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