Econ Test Review: Chapter 13

When an activity has a private marginal benefit of Di, a private marginal cost of Si, and a positive externality, which curve best represents the social marginal benefit?

D2

Which statement describes a public good?

It is nonrival in consumption and non excludable.

Which of these is non excludable but rival?

a common property resource

All of these are consequences of global warming EXCEPT:

an increase in the natural carbon absorption system

The largest form of greenhouse gases caused by human activity is:

carbon dioxide from the use of fossil fuel

Which of these is a pure public good?

environmental protection

Global warming is described as a ______ negative externality with a _____ time horizon.

large; long

If an unregulated industry generated pollution, the market price is ____ then the socially optimal price, and the market quantity is _____ than the socially optimal quantity

less; greater

Which of these is not a major cause of greenhouse gas emissions?

soybean farming

What type of government policy is generally used when a positive externality is present?

subsidies