Ch. 13

Which of these is both nonexcludable and nonrival? A. distilled water B. an open-air playground C. a beach D. clean air

clean air

________ may be enforced with patents or copyright protection, for example, for software programs or other electronics. A. intellectual property rights B. trade agreements C. ownership rights D. private property rights

intellectual property rights

A good that _____ is likely to suffer from a free-rider problem. A. has a sticky price B. is nonexcludable C. produces a negative externality D. is new in an established market

is nonexcludable

The Junkbuyers Company travels from home to home, purchasing items that would otherwise be put out with the garbage. Presumably both the buyer and the seller benefit from the transaction. The company also reduces the amount of garbage produced. SInce this situation, the social benefits are _____ the private benefits. A. smaller than B. the same as C. larger than D. more important than

larger than

Which of these is a positive externality of a new technology such as the cell phone? A. the increase in profits for the innovator B. an increase in wages for high-tech workers C. other new technologies invented as a result D. more efficient use of natural resources

other new technologies invented as a result

Which of these encourages innovation by securing a private return? A. patents and copyrights B. welfare programs C. entitlements D. tariffs

patents and copyrights

A restaurant owner trying to determine whether to borrow money to open a second restaurant will compare interest rates with _____. A. real estate prices B. the expected rate of return C. the prevailing wage D. the size of the money supply

the expected rate of return

Which of the following would most likely be recognized as a defining characteristic of a public good? the good is nonrivalrous item the good is nonexcludable item the good is both a and b above the good is a separate and identifiable item

the good is both a and b above

Which of these allows a private firm to sell a good that is both nonrival and nonexcludable? A. government subsidies B. the use of advertising C. intellectual property rights D. charging tolls

the use of advertising