Econ final - chap 19
Which of the following might have a free rider problem?
a large fireworks display
Suppose someone stole a DVD from a retail outlet. Regardless of how that person values the DVD, does the movie company lose any revenue as a result of the theft?
yes
Solving a tragedy of the commons problem could be done through:
1. Establishment of property rights over the common resource 2. Government-armed protection
The nation of Alphaville has been hunting their deer population to extinction. The government decrees strict limits on the number of hunters, and on the number of rounds of ammunition that each hunter can take into the hunt. How do you think hunters will respond?
Increase the quality of their weapons
Cable television
Nonrival, excludable
Yosemite National Park
Nonrival, excludable
The Chinese Language
Nonrival, non-excludable
The idea of calculus
Nonrival, non-excludable
Monica pays her local property taxes and state incomes taxes. Police patrol her neighborhood regularly.
Paying taxes for public goods
Farm-raised salmon
Rival, excludable
apples
Rival, excludable
A person ______ be cheaply prevented from using national defense, a ______good.
cannot, nonexcludable
What is the logic behind free riding? a. My decision to buy or not buy doesn't affect whether I receive the service b. It's better to get something for free than have to pay for it c. Receiving the service is solely based on the decisions of others d. All of the above
d. all of the above
Suppose someone illegally downloaded a movie instead of purchasing it. Also suppose that person placed a low value on the movie (they valued it less than the price required to purchase it legally). Does the movie company lose any revenue as a result of the theft? Why or why not?
no
An example of a common resource would be:
environment
Private goods can be provided by competitive markets because they are:
excludable, providing an incentive to pay for and thus to produce these goods.
True or false: a public good is defined as one produced by the public sector.
false
In Britain, Alistair pays a tax to support the British Broadcasting Company. He doesn't own a radio or TV.
forced rider
In the United States, Sara pays taxes to fund children's immunizations. She lives out in the forest, has no family, and rarely sees other people.
forced rider
The tragedy of the commons is more likely to apply to:
forests, fish, and elephants.
In Japan, Dave, a tourist from the United States, enjoys the public parks.
free rider
If the world collectively decided to tax the population to invest in asteroid defense, who would be the free riders?
future generations
At some restaurants and grocery stores, you can buy bison burgers made from farm-raised bison. Is this good news or bad news if we want more bison around?
good news
What happens to the number of tuna?
it decreases
Because of the rules humans have concerning chickens, what happens to the number of people raising chickens as a result of the price change?
it increases
Because of the rules humans have concerning tuna, what happens to the number of people harvesting tuna as a result of the price change?
it increases
In this video, we learn that chickens and the "chicken of the sea" (tuna) are fundamentally different in terms of population though they are both food. As population and prosperity has increased, the demand for chicken has increased. What happens to the price of chickens as a result?
it increases
What happens to the number of chickens?
it increases
What happens to the price of tuna as population and prosperity increase?
it increases
Both public goods and common resources are:
nonexcludable
A forced rider is someone who:
pays a share of the costs of a public good but who does not enjoy the benefits
Which of the following is a common resource?
public beach, public road
A free rider is a person who:
receives the benefit of a good but avoids paying for it
As the technology of home movie entertainment has changed from tapes and discs to digital files, home viewing of movies has changed from rival to nonrival.
true
In which of the following cases is there the potential for a free rider problem?
voluntary payment for smog protection.
Some media companies (especially in music and movie industries) run ads claiming that downloading or copying media is the same thing as stealing a CD or DVD from a store. Let's see if this is the case. Is a DVD a rival good?
yes
Suppose someone illegally downloaded a movie instead of purchasing it. Also suppose that person placed a high value on the movie (they valued it more than the price required to purchase it legally). Does the movie company lose any revenue as a result of the theft?
yes
We learned that asteroid defense is a public good. Which of the following group(s) of people, if any, would potentially value investment in asteroid defense more than the rest of humankind?
young people
