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Exam 9: Externalities: Pollution, education, and Health Care

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Question 21

Multiple Choice

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The marginal cost of production that is borne by the entire society is called the marginal

A) private cost.
B) social cost.
C) external cost.
D) public cost.
E) user cost.

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Question 22

Multiple Choice

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-The figure above shows the market for college education in the United States.The efficient quantity of college education is ________ students per year.

A) 10 million
B) 12 million
C) 17 million
D) 18 million
E) 14 million

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Question 23

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Does inoculation against chicken pox have both private and external benefits?

A cost that arises from the production or consumption that falls on someone other than the producer or consumer is called

-The figure above shows the market for education.Education has an external benefit. a.If the market is competitive and left unregulated,how many students will be enrolled per year? b.What is the efficient number of students? c.In the figure,show the effect of a government subsidy that moves the market to the efficient number of students.What is the amount of the subsidy and what tuition must the students pay?

If the production of a good causes pollution (an external cost),is the unregulated competitive market equilibrium of that product efficient?

-The figure above shows the market for annual influenza immunizations the United States.If there is NO external benefit from health care and the government does not intervene in the market,then the equilibrium price of immunizations is

Explain why a producer who is causing external costs does not have the incentive to reduce these costs.

Which of the following are devices that the government uses to achieve a more efficient allocation of resources in the presence of external benefits?

-The figure above illustrates the marginal private cost and the marginal social cost to the city of Seattle for each rock concert that is offered.Suppose the marginal private cost of the 5th concert is $10,000.Then,for the 5th concert,the

External benefits are the extra

Legally established titles to ownership,use,and disposal of factors of production and goods and services,are called ________ rights.

If the marginal private benefit of attending college for Shelly is $40,000 and the marginal external benefit is $15,000,she will attend college if the cost of attendance is no more than

When studying pollution and the environment,economists

-The figure above shows the costs and benefits associated with producing paper.What is the unregulated competitive market level of output?

The basic reason that a competitive unregulated market produces an inefficient amount of a good with an external cost is because

Which of the following is an example of a product that is made available through public provision? I.local police protection Ii.public schools Iii.local fire department

In the figure above,suppose the government provides vouchers worth $15,000 per student per year.Then the market equilibrium occurs at a tuition of ________ a year and ________ million students.

The marginal cost of production that is borne by the entire society is called the marginal

The production of paper creates pollution,an external cost.What happens to the production of paper if the government imposes a tax on paper producers equal to the marginal external cost of the pollution?