Quiz 5

Question 1

If many people in a community get flu shots, the whole community benefits, including those who did not get flu shots. Therefore, not enough people may decide to get the shots. This is an illustration of?

Answer 1

Demand-side market failure

Question 2

The two main characteristics of a public good are-

Answer 2

-Nonrivalry
-Non-excludability

Question 3

Unlike a private good, a public good-

Answer 3

Has benefits available to all, including non-payers
(The community that got flu shots, including the non payers)

Question 4

Which of the following is an example of a private good?

Answer 4

Sunglasses
(Private goods are distinguished by rivalry and excludability)

Question 5

At the optimal quantity of a public good,

Answer 5

Marginal benefit equals marginal cost

Question 6

A demand curve for a public good is determined by

Answer 6

Summing vertically the individual demand curves for the public goods

Question 7

All of the followings are public goods except

Answer 7

A toll road
(Examples of public goods include: national defense, outdoor firework displays, the light beams projected by lighthouses, public art displays, and public concerts. Broadcast TV- which is a nonrival, non-excludable public goods is provided by private companies. Roads and highways can be run privately, as excludability is possible it’s toll booths)

Question 8

The upward slope of the supply curve of a public good is due to

Answer 8

Riding marginal costs

Question 9

The collective willingness to pay-

Answer 9

Is the first willing to pay combined

Question 10

Cost benefit analysis attempts to

Answer 10

Compare the benefits and costs associated with any economic project or activity