32. ECO1050 u08q1 Question 32 (Points: 3) Which of the following statements is c

Question

32. ECO1050 u08q1 Question 32 (Points: 3) Which of the following statements is correct? (3 points).



1. The goal of bureaucracy is to minimize its budget.

2. Private firms are unable to produce public goods and sell them to the government, so a government-operated bureau must produce public goods.

3. The income elasticity of demand for public goods is less than 1.

4. As voters' incomes increase, the demand for many public goods increases more rapidly than income.

Save Answer 33. ECO1050 u08q1 Question 33 (Points: 3) In which of the following cases does the problem of the commons occur? (3 points).
1. Cattle grazing on private ranches.
2. Catching lobsters off the coast of Florida.
3. Raising salmon on salmon farms.
4. Using legal services provided by the courts.




1. Statements 1 and 4.

2. Statements 2 and 3.

3. Statement 2 only.

4. Statement 1 only.

Save Answer 34. ECO1050 u08q1 Question 34 (Points: 3) Why does the problem of the commons arise? (3 points).



1. Because marginal private benefit exceeds marginal cost when the resource is used.

2. Because marginal cost exceeds marginal private benefit when the resource is used.

3. Because marginal private benefit exceeds marginal social benefit when the resource is used.

4. Because marginal social benefit exceeds marginal private benefit when the resource is used.

Save Answer 35. ECO1050 u08q1 Question 35 (Points: 2) This is one way to overcome the problem of the commons. (2 points).



1. Take away property rights so that no one owns the resource.

2. Assign property rights so that someone owns the resource.

3. Leave the market alone because the market will reach an equilibrium in which the efficient amount of the resource is used.

4. None of the above answers is correct

Save Answer 36. ECO1050 u08q1 Question 36 (Points: 2) What can an individual transferable quota be used to achieve? (2 points).



1. The equilibrium level of a private good.

2. The efficient use of a common resource.

3. The equilibrium level of a common resource.

4. The equilibrium level of a public good.

Save Answer 37. Which of the following statements is correct? (3 points). (Points: 2)



1. Fish in the ocean are an example of common resource because they are nonrival and nonexcludable.

2. Fish in the ocean are an example of public good because they are rival and excludable.

3. Fish in the ocean are an example of common resource because they are rival and nonexcludable.

4. Fish in the ocean are an example of public good because they are nonexcludable and nonrival.

Save Answer 38. ECO1050 u08q1 Question 38 (Points: 2) What does the free-rider problem apply to? (2 points).



1. Common resources.

2. When marginal social benefit exceeds marginal private benefit.

3. Rival and excludable goods.

4. Nonrival and nonexcludable goods.

Save Answer 39. ECO1050 u08q1 Question 39 (Points: 2) The reason that private provision of a public good often leads to inefficiency is this. (2 points).



1. No one has an incentive to conserve the good.

2. Private property rights are too costly to enforce.

3. No one has the incentive to pay for the good.

4. Marginal private benefits are too costly to calculate.

Save Answer 40. ECO1050 u08q1 Question 40 (Points: 2) How do we determine the efficient quantity of a public good to supply? (2 points).



1. Marginal benefit and marginal cost are equated, the same as is done to determine the efficient quantity of a private good.

2. The private firms that will produce the good divide the amount equally.

3. Total benefit is equated to total cost, the same as is done to determine the efficient quantity of a private good.

4. Politicians use the principle of maximum differentiation.

Explanation / Answer

2 3 1 4 3 3 2 1 3

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