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Which of the following goods best fit the characteristics of a private good?
a) disease prevention
b) a professor giving a lecture in a large classroom
c) fire protection
d) an ice-cream cone
 
Which of the following goods is most likely an artificially scarce good?
a) health care
b) tickets to a boxing match
c) pay-per-view of a boxing match 
d) the police department
 
An individual is more likely to free ride when a good is:
a) artificially scarce.
b) private.
c) nonexcludable.
d) nonrival.
 
A common resource is a good or service for which exclusion is:
a) possible and which is rival in consumption.
b) not possible and which is rival in consumption.
c) possible and which is nonrival in consumption.
d) not possible and which is nonrival in consumption.
 
A pay-per-view movie is an artificially scarce good because we ________ prevent consumption
by people who do not pay for it, and the same unit ________ be consumed by more than one
person at the same time.
a) can; cannot
b) cannot; can
c) cannot; cannot
d) can; can
 
Stephanie stops at a gas station to fill up the tank of her car. The gallons of unleaded
gasoline in her tank are best described as:
a) private goods.
b) artificially scarce goods.
c) public goods.
d) common resources.
 
Most neighborhood streets are illuminated at night by streetlights.
The streetlights are ________ and ________.
a) nonrival; excludable
b) rival; nonexcludable
c) rival; excludable
d) nonrival; nonexcludable
 
Public goods differ from common resources in that:
a) both are nonrival in consumption, but public goods are excludable while common resources are nonexcludable.
b) both are nonexcludable, but public goods are nonrival in consumption while common resources are rival in consumption.
c) both are excludable, but public goods are nonrival in consumption while common resources are rival in consumption.
d) both are rival in consumption, but public goods are nonexcludable while common resources are excludable.
 
Which of the following activities is a public good?
a) voting
b) smoking
c) going to school
d) getting a flu shot
 
When the market does NOT result in an efficient allocation of scarce resources, economists say there has been:
A.) market dropout.
B.) normative economics.
C.) market failure.
D.) market disincentives.
 
Which of the following is the best example of a good whose consumption is nonexclusive?
a) ice cream
b) a taco
c) clothing
d) national defense
 
True or False: To ensure the efficient use of common resources, the cost of using those resources must be internalized. This is _____.
a) True
b) False
 
True or False: Clean water is a public good. This is _____.
a) True
b) False
 
Creating a system of tradable licenses that allow people to use common resources is a means of internalizing the social cost. This is _____.
a) True
b) False
 
To ensure the efficient use of common resources, the cost of using those resources must be internalized. This is _____.
a) True
b) False
 
The horizontal sum of individual demand curves is equal to the marginal social benefit of a public good. This is _____.
a) True
b) False
 
Public goods may be provided by the government. This is _____.
a) True
b) False
 
Clean water is a public good. This is _____.
a) True
b) False
 
Because of trade restrictions, imported caviar is an artificially scarce good. This is _____.
a) True
b) False
 
The private market will provide the efficient amount of electronic textbooks. This is _____.
a) True
b) False
 
Production of police protection is likely to be inefficiently low in a market economy. This is _____.
a) True
b) False
 
True or False: Computer software is a nonexcludable good. This is _____.
a) True
b) False
 
National defense is a common resource. This is _____.
a) True
b) False
 
Groundwater is a common resource. This is _____.
a) True
b) False
 
Consumption of cable television is likely to be inefficiently low because it is excludable and nonrival. This is _____.
a) True
b) False
 
Consumption of cable television is likely to be inefficiently low because it is excludable and nonrival. This is _____.
a) True
b) False
 
All of the following could be considered public goods EXCEPT:
a) shoulder surgery.
b) a fireworks display.
c) scientific research.
d) a flood control dam.
 
Which good is the BEST example of a public good?
a) a raincoat
b) a system of sirens to warn of approaching storms
c) a storm cellar.
d) a gasoline-powered electric generator
 
A good that is nonexcludable and rival in consumption is a(n):
a) public good.
b) private good.
c) common resource.
d) artificially scarce good.
 
Which type of good suffers from inefficiently low production in a market economy?
a) excludable
b) nonrival
c) rival
d) nonexcludable
 
Which good is the BEST example of a public good?
a) dance instruction
b) jewelry repair
c) broadcast television
d) television repair
 
A good is a private good if it is:
a) nonexcludable and nonrival in consumption.
b) excludable and nonrival in consumption.
c) excludable and rival in consumption.
d) nonexcludable and rival in consumption.
 
A pizza is an example of a(n)
a) private good.
b) public good.
c) common resource.
d) artificially scarce good.
 
Which good is the BEST example of a public good?
a) a raincoat
b) a system of sirens to warn of approaching storms
c) a storm cellar
d) a gasoline-powered electric generator
 
A good that is excludable and nonrival in consumption is a(n):
a) public good.
b) common resource.
c) private good.
d) artificially scarce good.
 
Goods for which consumption is inefficiently high are usually:
a) private goods.
b) artificially scarce goods.
c) public goods.
d) common resources.
 
Which good is the BEST example of a public good?
a) a raincoat
b) a system of sirens to warn of approaching storms
c) a storm cellar
d) a gasoline-powered electric generator
 
Which good is the BEST example of a public good?
a) pet sitting
b) police protection
c) popcorn
d) plywood
 
A good is a common resource if it is:
a) nonexcludable and nonrival in consumption.
b) excludable and rival in consumption.
c) excludable and nonrival in consumption.
d) nonexcludable and rival in consumption.
 
A good that is nonexcludable and rival in consumption is a(n):
a) public good.
b) private good.
c) common resource.
d) artificially scarce good.
 
Which of the following goods is MOST likely to be under-produced in a market economy?
a) airplane travel
b) corn
c) clean air
d) computer printers
 
The difference between a common resource and a public good is that the common resource is:
a) nonexcludable and the public good is excludable.
b) rival in consumption and the public good is nonrival.
c) excludable and the public good is nonexcludable.
d) nonrival in consumption and the public good is rival.
 
Which good is the BEST example of a public good?
a) disease prevention
b) a smart phone
c) a hot air balloon ride
d) an antique car
 
An e-book is similar to a published book in that it is _____, but it is also similar to national defense in that it is _____.
A.) nonexcludable; rival in consumption
B.) nonrival in consumption; excludable
C.) rival in consumption; nonexcludable
D.) excludable; nonrival in consumption
 
A good is excludable if nonpayers can be prevented from consuming it.
A.) True
B.) False
 
For a public good, the marginal social benefit will be higher than any individual's marginal benefit of consumption.
A.) True
B.) False
 
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:
A.) the wrong policy tool for solving the problem of congestion; instead, motorists should be allowed to make deals to
determine when and where they are permitted to drive.
B.) an attempt to internalize the costs of traffic delays and congestion.
C.) a Pigouvian tax aimed at regulating the use of city streets, a common resource, and an attempt to internalize the
costs of traffic delays and congestion.
D.) a Pigouvian tax aimed at regulating the use of city streets, a common resource.
 
If left to the private market, the amount of police protection provided in a city would be _____ than it is now, and
free riders would pay _____ for police protection.
A.) more; more
B.) less; a higher price
C.) less; nothing
D.) more; nothing
 
The private market will lead to _____ of clean air because _____.
A.) too much consumption; it is nonexcludable but rival in consumption
B.) production of the socially optimal amount; the marginal cost is zero
C.) too little consumption; it is nonexcludable but rival in consumption
D.) government provision; it is a public good
 
A(n) _____ is excludable and rival in consumption.
A.) artificially scarce good
B.) common resource
C.) private good
D.) public good
 
If a good is subject to the free-rider problem and an inefficiently high level of consumption, the good must be a(n):
A.) artificially scarce good.
B.) public good.
C.) private good.
D.) common resource.
 
Imposing a Pigouvian tax on a good, establishing a system of tradable licenses, and assigning property rights are
methods to alleviate the problems associated with:
A.) common resources.
B.) positive externalities.
C.) public goods.
D.) private goods.
 
The best example of a public good is:
A.) legal services.
B.) national defense.
C.) a municipal library.
D.) cable television programming.
 
Public goods are NOT sold in efficient quantities in the marketplace because:
A.) the more one person has, the less another person has.
B.) they are usually so costly that only the wealthy can afford them.
C.) once supplied to a buyer, they can be made available at no cost to someone else.
D.) they are usually very poor quality goods.
 
Consider an economy with just two citizens. If Sanjay's marginal benefit from mosquito control is $10 and Anjuli's marginal
benefit is $25, then the optimal level of a public good like mosquito control occurs when the marginal cost of mosquito control is:
A.) $10.00.
B.) $25.00.
C.) $35.00.
D.) $17.50.
 
A good is _____ if the supplier of that good can prevent people who do not pay from consuming it.
a) rival
b) inferior
c) nonexcludable
d) excludable
 
A good that is nonrival in consumption and nonexcludable is a(n):
a) public good.
b) common resource.
c) private good.
d) artificially scarce good
 
The private market will provide:
a) a zero quantity of an artificially scarce good.
b) the efficient quantity of an artificially scarce good.
c) more than the efficient quantity of an artificially scarce good.
d) less than the efficient quantity of an artificially scarce good.
 
Which good is the BEST example of a public good?
a) a motorcycle helmet
b) a flashlight
c) a chess set
d) national defense
 
Which of the following goods is a private good?
a) an apple
b) pay-per-view movies
c) national defense
d) the warning from a weather siren
 
All of the following could be considered public goods EXCEPT:
a) national defense.
b) the legal system.
c) a computer printer.
d) a city park.
 
Every few months, public radio announces a call for pledge support. During this time, it asks listeners to contribute
to their local public radio station. Although they raise money during this time, it often falls short of the amount they
wish to raise because:
A.) public radio free-rides on the listeners.
B.) the marginal social cost equals the marginal social benefit of public radio listening.
C.) listeners know they will be able to hear public radio even if they don't contribute.
D.) they do not make the pledge period long enough.
 
Public goods differ from common resources in that both are _____, but public goods are _____,
while common resources are _____.
A.) rival in consumption; nonexcludable; excludable
B.) nonrival in consumption; excludable; nonexcludable
C.) nonexcludable; are nonrival in consumption; rival in consumption
D.) excludable; nonrival in consumption; rival in consumption
 
Most neighborhood streets are illuminated at night by streetlights. The streetlights are _____ and _____.
Therefore, they are likely to be _____ by the competitive market.
A.) nonrival; nonexcludable; overprovided
B.) nonrival; excludable; underprovided
C.) rival; excludable; efficiently provided
D.) nonrival; nonexcludable; underprovided
 
A low voter turnout can be explained by noting that political action is a public good and people who don't vote
can free-ride on those who do.
A.) True
B.) False
 
Assigning property rights helps to correct the problems associated with common resources:
A.) because it allows the government to determine the amount that would lead to the socially optimal amount.
B.) because it makes the good nonrival in consumption.
C.) and therefore allows the market to better assess the marginal social benefits.
D.) because it allows property owners to exclude users and to manage the resource more efficiently.
 
Wenqin lives in a city that has a huge public rose garden. Residents can stroll through the rose garden, enjoy the
scenic vistas, or have a picnic, all without paying a fee. The public rose garden is best described as:
A.) rival and excludable.
B.) nonrival and excludable.
C.) nonrival and nonexcludable.
D.) rival and nonexcludable.
 
Which of the following is a private good?
A.) a fast-food cheeseburger
B.) traffic lights
C.) cell phone service
D.) mountain bike trails in a national forest
 
Pharmaceutical companies typically face very high fixed costs when developing new drugs. The marginal cost
of producing a drug after development is very low. When these companies set price and output to maximize
profit, patients pay a _____ price for _____ amounts of the drug than are socially optimal.
A.) higher; higher
B.) lower; lower
C.) lower; higher
D.) higher; lower
 
The best example of a private good is:
A.) an automobile.
B.) national defense.
C.) law enforcement.
D.) public education.
 
Which good is artificially scarce?
a) protection of endangered species
b) national defense
c) sunscreen
d) on-demand movies
 
Construction of a system of levees and dams to provide flood protection is a(n):
a) artificially scarce good.
b) public good.
c) common resource.
d) private good.
 
Which good is artificially scarce?
a) protection of endangered species
b) national defense
c) sunscreen
d) on-demand movies