Resource Problems: Sample Quiz Choose the most correct answer. Either click on a button or enter your answer in the box to the left of the question. When you have answered them all, click the Check-My-Answers button and you will see how well you know this material. 1. An example of a positive externality is: the whaling industry driving whales to the brink of extinction. a firm that dumps wastes into a river because water is free. a person who plants a flower garden that makes a neighborhood more pleasant. a firm that hires an employee whenever his marginal revenue produce exceeds his marginal resource cost. 2. Which of the following would you most expect to hear from an advocate of laissez-faire? Those who are most productive deserve to have more than average income. Because men are created equal, their incomes should be equal. Persons with high incomes have more economic power than those with low incomes, which is unjust. Persons with high incomes derive them from the exploitation of the poor. People should produce according to their ability and receive according to their needs. 3. Which of the following ways of avoiding the nuisance of mosquito bites provides the best example of a public good? A leisurely cruise to Australia A can of mosquito repellant The elimination of mosquito breeding grounds Window screens and a bed covered with mosquito netting The heavy use of garlic to ward off mosquitoes 4. Economists argue that the optimum amount of pollution is: zero. whatever the market provides. whatever level is decided by democratic processes. the level where extra costs of cleanup just equal extra benefits of cleanup. 5. In your Advanced Business Persuasion course you must do a group project with three other students. All will receive the same grade. The group may find a problem of: free riders. the substitution effect. present value. rent seeking. 6. According to economic theory, the major reason that wages of teachers have risen during the past fifty years is that: the productivity of teachers has increased dramatically during that time. the opportunity cost of being a teacher has risen. sex discrimination has decreased. the external effects of the teaching profession have been internalized. 7. Pollution is an example of a: public good. moral hazard. negative externality. concentration of market power. Choose the most correct answers. Either click the buttons, or enter the answers from the keyboard. Return to   Web ingrimayne.com Copyright Robert Schenk