Economics Chapter 17 Multiple Choice Traffic Congestion Causes Higher Cost

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Figure: An Individual‘s Marginal Benefit from a Public Good

Reference: Ref 17-5

(Figure: An Individual’s Marginal Benefit from a Public Good) Look at the figure An

Individual’s Marginal Benefit from a Public Good. Assume that two individuals will

share consumption of a public good; each individual has the same marginal benefit

curve as the one shown in the figure. If the marginal cost of the good is $24, what

is the total benefit of the level of the public good that maximizes society‘s welfare?

122. Multiple Choice: Figure: An Individual’s Marginal Bene...

Question

Points: 0

Figure: An Individual‘s Marginal Benefit from a Public Good

Reference: Ref 17-5

(Figure: An Individual’s Marginal Benefit from a Public Good) Look at the figure An

Individual’s Marginal Benefit from a Public Good. Assume that two individuals will

share consumption of a public good; each individual has the same marginal benefit

curve as the one shown in the figure. If the marginal cost of the good is $8, how

much of the public good will be provided by the private market?

123. Multiple Choice: Figure: An Individual’s Marginal Bene...

Question

Points: 0

Figure: An Individual‘s Marginal Benefit from a Public Good

Reference: Ref 17-5

(Figure: An Individual’s Marginal Benefit from a Public Good) Look at the figure An

Individual’s Marginal Benefit from a Public Good. Assume that two individuals will

share consumption of a public good; each individual has the same marginal benefit

curve as the one shown in the figure. If the marginal cost of the good is $8, what is

the level of this public good that will maximize society‘s welfare?

124. Multiple Choice: For a public good, the marginal socia...

Question For a public good, the marginal social benefit:

Answer equals the sum of the individual marginal benefits for all of the consumers of

that unit.

Points: 0

125. Multiple Choice: Reference: Ref 17-6 (Table: Marginal...

Question

Reference: Ref 17-6

(Table: Marginal Benefit from Additional Streetlights) Dave and Art live in a new

housing development and would like to have streetlights installed. The table

Marginal Benefit from Additional Streetlights shows Dave’s and Art’s individual

marginal benefit of different numbers of streetlights. Suppose that the marginal cost

of installing a streetlight is $6. What is the maximum that Art would be willing to

pay to have one streetlight installed in the neighborhood?

126. Multiple Choice: Reference: Ref 17-6 (Table: Marginal...

Question

Reference: Ref 17-6

(Table: Marginal Benefit from Additional Streetlights) Dave and Art live in a new

housing development and would like to have streetlights installed. The table

Marginal Benefit from Additional Streetlights shows Dave’s and Art’s individual

marginal benefit of different numbers of streetlights. Suppose that the marginal cost

of installing a streetlight is $6. If Dave had to pay for streetlights on his own, how

many streetlights would there be?

Points: 0

127. Multiple Choice: Reference: Ref 17-6 (Table: Marginal...

Question

Reference: Ref 17-6

(Table: Marginal Benefit from Additional Streetlights) Dave and Art live in a new

housing development and would like to have streetlights installed. The table

Marginal Benefit from Additional Streetlights shows Dave’s and Art’s individual

marginal benefit of different numbers of streetlights. Suppose that the marginal cost

of installing a streetlight is $6. What is the socially optimal number of streetlights

in the neighborhood?

128. Multiple Choice: Which of the following statements is ...

Question Which of the following statements is true?

Points: 0

129. Multiple Choice: What is difficult about estimating th...

Question What is difficult about estimating the level of a public good that will maximize

social welfare using cost-benefit analysis?

130. Multiple Choice: Which of the following is an example ...

Question Which of the following is an example of a common resource?

131. Multiple Choice: Which of the following is a common re…

Question Which of the following is a common resource?

132. Multiple Choice: Common resources tend to be ________ ...

Question Common resources tend to be ________ through private markets.

Answer associated with prices that are too high

Points: 0

133. Multiple Choice: If the marginal benefit received from…

Question If the marginal benefit received from a good is equal to the marginal opportunity

cost of production, then:

134. Multiple Choice: If the marginal benefit received from…

Question If the marginal benefit received from a good is less than the marginal social cost of

production, then:

135. Multiple Choice: If the marginal benefit received from…

Question If the marginal benefit received from a good is greater than the marginal social cost

of production, then:

Points: 0

136. Multiple Choice: If the marginal benefit received from…

Question If the marginal benefit received from a good is equal to the marginal social cost of

production, then:

Answer society‘s well-being can be improved if production increases.

137. Multiple Choice: If the marginal benefit received from…

Question If the marginal benefit received from a good is less than the marginal opportunity

cost of production, then:

Answer society‘s well-being can be improved if production increases.

138. Multiple Choice: If the extent to which common resourc...

Question If the extent to which common resources (such as fish in the sea) should be

utilized is left to the private market, then:

Answer resource use will be efficient and will maximize social welfare.

139. Multiple Choice: If the use of a common resource is de…

Question If the use of a common resource is determined in the private market, the resource:

Points: 0

140. Multiple Choice: Common resources tend to be overused ...

Question Common resources tend to be overused because:

141. Multiple Choice: For a common resource, the marginal b...

Question For a common resource, the marginal benefit at the quantity provided by a private

market is ________ the marginal social cost.

142. Multiple Choice: Figure: Marginal Social Cost and Supp...

Question

Points: 0

Figure: Marginal Social Cost and Supply

Reference: Ref 17-7

(Figure: Marginal Social Cost and Supply) In the figure Marginal Social Cost and

Supply, the marginal social cost curve lies above the supply curve:

because this is a public good.

143. Multiple Choice: Consumption of a common resource is i...

Question Consumption of a common resource is inefficiently too ________ because the

marginal social cost of the resource is ________ than the private marginal cost.

144. Multiple Choice: Traffic congestion causes higher cost...

Question Traffic congestion causes higher costs and discomfort to residents of a city. An

outcome like this arises for common resources because:

Answer

Points: 0

145. Multiple Choice: If the market supply and demand curve…

Question If the market supply and demand curves for a common resource include all costs,

then:

146. Multiple Choice: Figure: Model of a Market for a Commo...

Question

Points: 0

Figure: Model of a Market for a Common Resource

Reference: Ref 17-8

(Figure: Model of a Market for a Common Resource) The figure Model of a Market

for a Common Resource shows the intersection of the private supply and demand

curves. Without any consideration of the marginal social cost of using a common

resource, the quantity of the common resource used at Q will be:

147. Multiple Choice: An individual will continue to use a ...

Question An individual will continue to use a common resource until his or her:

148. Multiple Choice: The marginal social cost of a common ...

Question The marginal social cost of a common resource is ________ than an individual’s

marginal cost, and without government intervention the market will allow provision of

________ of the common resource than is socially optimal.

Points: 0

149. Multiple Choice: Suppose the Alaskan king crab harvest...

Question Suppose the Alaskan king crab harvest is unregulated and any person with a boat

can go offshore, lower a crab pot, and harvest king crab. This common resource

will likely be ________ because the marginal social cost of harvesting crabs

________.

150. Multiple Choice: The problem with common resources is ...

Question The problem with common resources is similar to the problem with negative

externalities because:

151. Multiple Choice: One way the government of Alaska coul...

Question One way the government of Alaska could prevent an inefficiently large production of

crab fishing would be to:

Points: 0

152. Multiple Choice: In London, any motorist entering a pa...

Question In London, any motorist entering a particular area in the city center during certain

specified times must pay a congestion fee equal to £8, with fines for

noncompliance rising to as high as £120. The congestion fee is:

153. Multiple Choice: A Pigouvian tax can lead to the effic...

Question A Pigouvian tax can lead to the efficient level of production and consumption of:

154. Multiple Choice: Whenever a species is threatened with...

Question Whenever a species is threatened with extinction, it is likely that:

Points: 0

155. Multiple Choice: The government can intervene to achie…

Question The government can intervene to achieve the socially optimal quantity of a common

resource by:

156. Multiple Choice: The government can intervene in fishi...

Question The government can intervene in fishing markets to avoid overfishing by:

157. Multiple Choice: If policy makers provide only enough ...

Question If policy makers provide only enough tradable permits to provide efficient use of a

common resource, only those who ________ will use the resource.

158. Multiple Choice: Suppose the Alaskan king crab harvest...

Points: 0

Question Suppose the Alaskan king crab harvest is unregulated and any person with a crab

boat and some diesel fuel can go offshore, lower a crab pot, and harvest king crab.

As a result, this common resource is overused. Which of the following policy

choices might create an outcome in which the king crab harvest is socially

optimal?

159. Multiple Choice: Figure: Correcting for Market Failure…

Question Figure: Correcting for Market Failure

Reference: Ref 17-9

(Figure: Correcting for Market Failure) Assume that there is an external cost

involved in the market illustrated in the figure Correcting for Market Failure.

Economists argue that in an unregulated private market, ________ is produced. In

the figure, the supply curve (S1) reflects ________ cost.

160. Multiple Choice: Figure: Correcting for Market Failure…

Points: 0

Question Figure: Correcting for Market Failure

Reference: Ref 17-9

(Figure: Correcting for Market Failure) Assume that there is an external cost

involved in the market illustrated in the figure The figure Correcting for Market

Failure. If the government forces the private-sector firms to face the external cost,

then:

161. Multiple Choice: Figure: Correcting for Market Failure…

Question

Points: 0

Figure: Correcting for Market Failure

Reference: Ref 17-9

(Figure: Correcting for Market Failure) Assume that there is an external cost

involved in the market illustrated in the figure Correcting for Market Failure. If the

government intervenes to correct for the external cost, the new ________ will now

reflect ________.

162. Multiple Choice: Figure: Correcting for Market Failure…

Question

Points: 0

Figure: Correcting for Market Failure

Reference: Ref 17-9

(Figure: Correcting for Market Failure) Assume that there is an external cost

involved in the market illustrated in the figure Correcting for Market Failure. When

the government intervenes to correct for the external cost, the output will ________

from ________ to ________.

163. Multiple Choice: Which of the following is an example ...

Question Which of the following is an example of an artificially scarce good?

164. Multiple Choice: Computer software that you can downlo...

Question Computer software that you can download from the Internet for a price is an

artificially scarce good because it is ________ but ________ in consumption.

Points: 0

165. Multiple Choice: The marginal cost of producing an art…

Question The marginal cost of producing an artificially scarce good is equal to:

166. Multiple Choice: Which of the following is an example ...

Question Which of the following is an example of an artificially scarce good?

167. Multiple Choice: The source of the inefficient use of ...

Question The source of the inefficient use of artificially scarce goods is similar to the source

of inefficiencies created by:

168. Multiple Choice: Reference: Ref 17-10 (Table: Margina...

Points: 0