Question 1

External benefits are the extra

Accepted Answer

A) benefits a consumer gets from consuming a good. 
B) costs a producer creates in producing a good. 
C) benefits that accrue to people other than the consumers. 
D) costs a producer bears for producing a polluting good. 
E) benefits a producer obtains for reducing production of a polluting good. 
A) benefits a consumer gets from consuming a good. 
B) costs a producer creates in producing a good. 
C) benefits that accrue to people other than the consumers. 
D) costs a producer bears for producing a polluting good. 
E) benefits a producer obtains for reducing production of a polluting good.

Question 2

If the production of a good causes pollution (an external cost),is the unregulated competitive market equilibrium of that product efficient?

Accepted Answer

The presence of pollution means that the

Question 3

Which of the following is an example of a product that is made available through public provision?
I.local police protection
Ii.public schools
Iii.local fire department

Accepted Answer

A) i only 
B) i and ii 
C) iii only 
D) i and iii 
E) i,ii,and iii 
A) i only 
B) i and ii 
C) iii only 
D) i and iii 
E) i,ii,and iii

Question 4

The marginal cost of production that is borne by the entire society is called the marginal

Accepted Answer

A) private cost. 
B) social cost. 
C) external cost. 
D) public cost. 
E) user cost. 
A) private cost. 
B) social cost. 
C) external cost. 
D) public cost. 
E) user cost.

Question 5

The basic reason that a competitive unregulated market produces an inefficient amount of a good with an external cost is because

Accepted Answer

A) producers cannot measure marginal social cost. 
B) producers do not pay the external cost. 
C) the general public does not care about external costs. 
D) external costs are not a political issue. 
E) the external cost is paid by consumers rather than producers. 
A) producers cannot measure marginal social cost. 
B) producers do not pay the external cost. 
C) the general public does not care about external costs. 
D) external costs are not a political issue. 
E) the external cost is paid by consumers rather than producers.

Question 6

The production of paper creates pollution,an external cost.What happens to the production of paper if the government imposes a tax on paper producers equal to the marginal external cost of the pollution?

Accepted Answer

When the government imposes a tax equal

Question 7

If the marginal private benefit of attending college for Shelly is $40,000 and the marginal external benefit is $15,000,she will attend college if the cost of attendance is no more than

Accepted Answer

A) $55,000. 
B) $45,000. 
C) $40,000. 
D) $25,000. 
E) $15,000. 
A) $55,000. 
B) $45,000. 
C) $40,000. 
D) $25,000. 
E) $15,000.

Question 8

In the figure above,suppose the government provides vouchers worth $15,000 per student per year.Then the market equilibrium occurs at a tuition of ________ a year and ________ million students.

Accepted Answer

A) $10,000;15 
B) $25,000;15 
C) $15,000;15 
D) $15,000;7.5 
E) $20,000;20 
A) $10,000;15 
B) $25,000;15 
C) $15,000;15 
D) $15,000;7.5 
E) $20,000;20

Question 9

Which of the following are devices that the government uses to achieve a more efficient allocation of resources in the presence of external benefits?

Accepted Answer

A) taxes,private subsidies,and regulation 
B) public provision,taxes,and private subsidies 
C) regulations,public provision,and vouchers 
D) vouchers,public provision,and private subsidies 
E) public provision,taxes,and vouchers 
A) taxes,private subsidies,and regulation 
B) public provision,taxes,and private subsidies 
C) regulations,public provision,and vouchers 
D) vouchers,public provision,and private subsidies 
E) public provision,taxes,and vouchers

Question 10

The marginal cost of production that is borne by the entire society is called the marginal

Accepted Answer

A) private cost. 
B) social cost. 
C) external cost. 
D) public cost. 
E) user cost. 
A) private cost. 
B) social cost. 
C) external cost. 
D) public cost. 
E) user cost.

Question 11

-The figure above illustrates the marginal private cost and the marginal social cost to the city of Seattle for each rock concert that is offered.Suppose the marginal private cost of the 5th concert is $10,000.Then,for the 5th concert,the

Accepted Answer

A) marginal external cost equals $30,000. 
B) marginal social cost equals $30,000. 
C) marginal external cost equals the marginal private cost. 
D) marginal external cost equals $40,000. 
E) marginal external cost equals $10,000. 
A) marginal external cost equals $30,000. 
B) marginal social cost equals $30,000. 
C) marginal external cost equals the marginal private cost. 
D) marginal external cost equals $40,000. 
E) marginal external cost equals $10,000.

Question 12

Explain why a producer who is causing external costs does not have the incentive to reduce these costs.

Accepted Answer

The answer lies in the fact that the cos

Question 13

A cost that arises from the production or consumption that falls on someone other than the producer or consumer is called

Accepted Answer

A) a negative benefit. 
B) a public choice impact. 
C) a positive externality. 
D) a negative externality. 
E) a private good. 
A) a negative benefit. 
B) a public choice impact. 
C) a positive externality. 
D) a negative externality. 
E) a private good.

Question 14

Does inoculation against chicken pox have both private and external benefits?

Accepted Answer

Yes,inoculation against chicken pox has

Question 15

When studying pollution and the environment,economists

Accepted Answer

A) have no role to play. 
B) concentrate on the physical aspects of the environment. 
C) emphasize costs and benefits. 
D) attempt to reduce pollution at all costs. 
E) think pollution is good if it occurs when production takes place. 
A) have no role to play. 
B) concentrate on the physical aspects of the environment. 
C) emphasize costs and benefits. 
D) attempt to reduce pollution at all costs. 
E) think pollution is good if it occurs when production takes place.

Question 16

-The figure above shows the costs and benefits associated with producing paper.What is the unregulated competitive market level of output?

Accepted Answer

A) 0 
B) 4 tons 
C) 6 tons 
D) More than 6 tons 
E) None of the above answers is correct. 
A) 0 
B) 4 tons 
C) 6 tons 
D) More than 6 tons 
E) None of the above answers is correct.

Question 17

Legally established titles to ownership,use,and disposal of factors of production and goods and services,are called ________ rights.

Accepted Answer

A) government 
B) pollution 
C) property 
D) inefficient 
E) private 
A) government 
B) pollution 
C) property 
D) inefficient 
E) private

Question 18

-The figure above shows the market for education.Education has an external benefit.
a.If the market is competitive and left unregulated,how many students will be enrolled per year?
b.What is the efficient number of students?
c.In the figure,show the effect of a government subsidy that moves the market to the efficient number of students.What is the amount of the subsidy and what tuition must the students pay?

Accepted Answer

a.If the market is competitive and left

Question 19

-The figure above shows the market for annual influenza immunizations the United States.If there is NO external benefit from health care and the government does not intervene in the market,then the equilibrium price of immunizations is

Accepted Answer

A) $30. 
B) $20. 
C) $40. 
D) $60. 
E) $70. 
A) $30. 
B) $20. 
C) $40. 
D) $60. 
E) $70.

Question 20

-The figure above shows the market for college education in the United States.The efficient quantity of college education is ________ students per year.

Accepted Answer

A) 10 million 
B) 12 million 
C) 17 million 
D) 18 million 
E) 14 million 
A) 10 million 
B) 12 million 
C) 17 million 
D) 18 million 
E) 14 million

External benefits are the extra

If the production of a good causes pollution (an external cost),is the unregulated competitive market equilibrium of that product efficient?

Which of the following is an example of a product that is made available through public provision? I.local police protection Ii.public schools Iii.local fire department

The marginal cost of production that is borne by the entire society is called the marginal

The basic reason that a competitive unregulated market produces an inefficient amount of a good with an external cost is because

The production of paper creates pollution,an external cost.What happens to the production of paper if the government imposes a tax on paper producers equal to the marginal external cost of the pollution?

If the marginal private benefit of attending college for Shelly is $40,000 and the marginal external benefit is $15,000,she will attend college if the cost of attendance is no more than

In the figure above,suppose the government provides vouchers worth $15,000 per student per year.Then the market equilibrium occurs at a tuition of a year and million students.

Which of the following are devices that the government uses to achieve a more efficient allocation of resources in the presence of external benefits?

The marginal cost of production that is borne by the entire society is called the marginal

-The figure above illustrates the marginal private cost and the marginal social cost to the city of Seattle for each rock concert that is offered.Suppose the marginal private cost of the 5th concert is $10,000.Then,for the 5th concert,the

Explain why a producer who is causing external costs does not have the incentive to reduce these costs.

A cost that arises from the production or consumption that falls on someone other than the producer or consumer is called

Does inoculation against chicken pox have both private and external benefits?

When studying pollution and the environment,economists

-The figure above shows the costs and benefits associated with producing paper.What is the unregulated competitive market level of output?

Legally established titles to ownership,use,and disposal of factors of production and goods and services,are called ________ rights.

-The figure above shows the market for annual influenza immunizations the United States.If there is NO external benefit from health care and the government does not intervene in the market,then the equilibrium price of immunizations is

-The figure above shows the market for college education in the United States.The efficient quantity of college education is ________ students per year.

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters

Exam 9: Externalities: Pollution, education, and Health Care

External benefits are the extra

If the production of a good causes pollution (an external cost),is the unregulated competitive market equilibrium of that product efficient?

Which of the following is an example of a product that is made available through public provision? I.local police protection Ii.public schools Iii.local fire department

The marginal cost of production that is borne by the entire society is called the marginal

The basic reason that a competitive unregulated market produces an inefficient amount of a good with an external cost is because

The production of paper creates pollution,an external cost.What happens to the production of paper if the government imposes a tax on paper producers equal to the marginal external cost of the pollution?

If the marginal private benefit of attending college for Shelly is $40,000 and the marginal external benefit is $15,000,she will attend college if the cost of attendance is no more than

In the figure above,suppose the government provides vouchers worth $15,000 per student per year.Then the market equilibrium occurs at a tuition of ________ a year and ________ million students.

Which of the following are devices that the government uses to achieve a more efficient allocation of resources in the presence of external benefits?

The marginal cost of production that is borne by the entire society is called the marginal

-The figure above illustrates the marginal private cost and the marginal social cost to the city of Seattle for each rock concert that is offered.Suppose the marginal private cost of the 5th concert is $10,000.Then,for the 5th concert,the

Explain why a producer who is causing external costs does not have the incentive to reduce these costs.

A cost that arises from the production or consumption that falls on someone other than the producer or consumer is called

Does inoculation against chicken pox have both private and external benefits?

When studying pollution and the environment,economists

-The figure above shows the costs and benefits associated with producing paper.What is the unregulated competitive market level of output?

Legally established titles to ownership,use,and disposal of factors of production and goods and services,are called ________ rights.

-The figure above shows the market for annual influenza immunizations the United States.If there is NO external benefit from health care and the government does not intervene in the market,then the equilibrium price of immunizations is

-The figure above shows the market for college education in the United States.The efficient quantity of college education is ________ students per year.

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters

In the figure above,suppose the government provides vouchers worth $15,000 per student per year.Then the market equilibrium occurs at a tuition of a year and million students.