246.
The graph shows the extraction costs for TX Oil Company in the first year in a situation
where it will extract oil from a reserve over two years. If the
current market price rises
from $60 to $70 and user costs are not considered, the extraction quantity
A.
rises by 10 units to 20 units.
19-102
247.
The graph shows the extraction costs for TX Oil Company in the first year in a situation
where it will extract oil from a reserve over two years. What will
be the quantity extracted
if user costs are considered, compared to the case where they are not considered?
A.
10 units versus 20 units
248.
The graph shows the extraction costs for TX Oil Company in the first year in a situation
where it will extract oil from a reserve over two years. If user costs
increase, then the total
cost line will
A.
stay the same and the extraction cost line will shift upward.
249.
The graph shows the extraction costs for TX Oil Company in the first year in a situation
where it will extract oil from a reserve over two years. If total
costs increase and the price
of oil stays at $60, then the firm will
A. extract more oil the current year.
250.
The goal of profit-maximizing extraction firms such as an oil company or a mining
company is to extract resources
A.
as fast as possible.
19-105
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Blooms: Understand
Dif f i c u l t y :
02 Medium
Learning Objective: 19–04 Show how the profit motive can encourage resource conservation.
Test Bank: II
Topic:
Natural Resource Economics
251.
Consider a coal mining company that can mine coal this year or next year. As expected
future profits increase, the extraction quantity this year
A.
increases due to a higher user cost.
252.
Consider an oil company that can pump oil from a reserve either this year or next year.
As expected future profits decrease, the extraction quantity this year
A. increases due to a higher user cost.
253.
In the case of extraction of a nonrenewable resource, when user costs increase, it
implies that expected future profits
A.
decrease, while the amount of current extraction increases.
19-106
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written consent of McGraw-Hill Education.
D.
increase, while the amount of current extraction decreases.
254.
In the case of extraction of a nonrenewable resource, when user costs decrease, then it
implies that expected future profits
D.
increase, while the amount of current extraction decreases.
255.
Overextraction of a resource in the present can occur because
A.
there is a user cost.
256.
If users can benefit from conservation, resources will be
A.
unprofitable.
19-107
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B.
extracted at a fast rate.
C.
preserved for future use.
D. overused in the present and the future.
257.
“Conflict diamonds“ refer to the diamonds
A. that were stolen by the Nazis in WWII and are now reclaimed by the true owners.
258.
When diamonds are mined in conflict or war-torn areas, there is
A.
more loss from auctioning off the resource.
259.
One major reason why the survival of elephants is threatened is that
A.
villages near elephants have high unemployment.
260.
Which of the following is the best example of a market failure to conserve a resource
resulting from poorly defined property rights?
D.
hunting of deer in the United States
261.
If the property rights for forests are clear and enforced, then
A.
they will become common property.
19-109
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written consent of McGraw-Hill Education.
Test Bank: II
Topic:
Renewable Resources
262.
In 2015, about what percentage of the world’s land area was forested?
A. 10 percent
263.
According to data from the UN Food and Agriculture Organization, from 2010 to 2015
the amount of land worldwide that’s covered by forests
A.
expanded by about 5 percent.
264.
According to data from the UN Food and Agriculture Organization, which of the
following nations had the fastest growing area of forested land in the
period 2010–2015?
A.
Brazil
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AACSB: Knowledge Application
Accessib i l i t y:
Keyboard Navigation
Blooms: Understand
Dif f i c u l t y :
02 Medium
Learning Objective: 19–05 Relate how to use property rights to prevent deforestation and
species extinction.
Test Bank: II
Topic:
Renewable Resources
265.
According to data from the UN Food and Agriculture Organization, which of the
following nations saw a significant decline in the amount of land covered
by forests in the
period 2010–2015?
A.
Thailand
266.
What is most likely to happen when no logger owns the property rights to a forest that
is open to logging?
D.
It will become the common property of the government.
267.
Commercially run forestry companies have the most profit incentive to harvest trees
from a forest
A.
early in the forest growth cycle.
268.
Commercially run forestry companies that have secure property rights over their trees
A.
harvest them as soon as possible and replant them when they are harvested.
269.
Which fishery product in the U.S. had the greatest market value in terms of its catch in
2014?
A.
blue crab
19-112
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written consent of McGraw-Hill Education.
Dif f i c u l t y :
02 Medium
Learning Objective: 19–05 Relate how to use property rights to prevent deforestation and
species extinction.
Test Bank: II
Topic:
Renewable Resources
270.
The key difficulty with fishery management is that
D.
there are so many types of fish, and they’re found in so many locations.
271.
A fishery collapse occurs when the
A.
fishery goes out of business.
272.
According to Seafish.org, approximately what percentage of the world’s fisheries in
2014 were overexploited?
A.
1 percent
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C.
30 percent
D. 50 percent
273.
Under the total allowable catch (TAC) system of fishing,
A. there are limits to the number of days a species can be caught.
274.
What is a tradable fishing limit that gives the holder the right to harvest a given
quantity of fish during a given time period?
A.
replacement rate