1. Which one of the following statements about public goods is true?
- Problems with public goods can always be solved by charging a fee to use the good
- Public goods will tend to be oversupplied
- Money to provide public goods is commonly collected from free riders
- Public goods may provide psychic benefits
- Public goods are any goods owned or provided by governments
2. Suppose that 10,000 people are willing to spend a maximum of $20 each to preserve one acre of rainforest. A conservation group mails out a request to each person asking him or her to mail in $40 to preserve one acre of rainforest. How many acres of rainforest will be preserved with this program?
- 5,000 acres
- 10,000 acres
- Zero acres
- 1,000 acres
- There is not enough information to answer the question
3. If 10,000 people are willing to spend a maximum of $20 each to preserve one acre of rainforest, how many acres of rainforest could be preserved, at $40 per acre without exceeding people's willingness to pay?
- 5,000 acres
- 10,000 acres
- Zero acres
- 1,000 acres
- There is not enough information to answer the question
4. The socially optimal provision of a public good can be obtained by ...
- Privatizing the good
- Vertically adding the demand curves for the good
- Eliminating access to the good
- Allowing open access to the good
- Horizontally adding the demand curves for the good
5. Which one of the following goods can be considered a global commons?
- A National Park
- A herd of deer
- A river
- An ocean
- A diamond mine
6. The "tragedy of the commons" is most likely to occur with which one of the following goods?
- A public highway
- A groundwater aquifer
- A national forest
- A mineral ore deposit
- A city park