FARE 1300 Lecture Notes - Lecture 6: Bill 78 (Quebec, 2012)

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greycrocodile330

1 Oct 2016

School

University of Guelph

Department

Food, Agricultural and Resource Economics

Course

FARE 1300

Professor

Andreas Boecker

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Document Summary

Natural condition of mankind = state of nature (no government) Were all born more or less equal - in the sense of general things. Without anyone to keep us in line (government) we will just ght for resources - there are more people than there are resources. Common power (government) = law = injustice - no right, no wrong. Without a government there is no order. Natural right - you do what you need to do to survive - self preservation. Natural law 1 - avoid con ict and ghting people - seek peace - if you can"t achieve this, do whatever you need to do to survive (perhaps start a war) Natural law 2 - whatever you want done to you, do to others - agree to treat. The above are the social contract/covenant - from this, government is born: people will never abide by the agreement unless there is someone to inform it.

Related Questions

Question 3

We saw in class that the same good can fall in different categories (public/private/club/common resource) depending on circumstances. An example of such a good would be watching a movie at the theater. If a lot of people want to watch it, the movie is a _________. If very few people want to watch it (to the point where a room could not even be filled), the movie is likely to be a _______.

A. a common resource; a public good

B. a public good; a common resource

C. a private good; a club good

D. a club good; a private good

3 points

Question 4

Which of the following statements about the free-rider problem is not true?

A. Individuals have an incentive to free-ride when the good is not excludable.

B. The kinds of goods for which the free rider problem arises are common resources and public good.

C. Markets for goods for which there is a free-rider problem are inefficient because not enough of the good is produced.

D. Goods for which the free-rider problem exists tend to be over provided relative to what would be optimal.

4 points

Question 5

To achieve the efficient provision of public goods, the

A. market should be allowed to operate without government intervention.

B. government must limit the provision of those goods.

C. government must tax producers of those goods.

D. government must either provide those goods or subsidize their production.

3 points

Question 6

Which of the following statements about public goods is not true?

A. Because people cannot be excluded from their consumption and thus have no incentive to pay for them, public goods are underprovided by the market.

B. Efficiency requires that the government provide or fund (subsidize) the provision of all public goods.

C. Efficiency requires that the government provide or fund only the public goods that create more benefits than costs to society.

D. In reality, it is hard to provide public goods efficiently.

3 points

Question 7

Public goods must be provided by the government as the market on its own will fail to provide them. However, even with government provision it is very hard to achieve efficiency. Why?

A. In reality, it is very hard (if not impossible) to accurately estimate the benefits of providing a public good.

B. A. In reality, there can be overruns in the cost of providing the public good.

C. Government decisions about which public goods to provide can be influenced by lobbying by interest groups.

D. All of the above are true.

4 points

Question 8

Which of the following is not a common resource?

A. congested roads

B. clean water

C. wild life, which hunters want to hunt and others want to view.

D. a fireworks display.

3 points

Question 9

Many species of animals must be protected by law to keep them from extinction. Why are cows not one of these endangered species even though there is such a high demand for beef?

A. Cows reproduce at a high rate and have adapted well to their environment.

B. Public policies protect cows from predators and diseases.

C. Cows are privately owned (private goods), whereas many endangered species are owned by no one (common resources).

D.There is a natural ecological balance between the birth rate of cows and human consumption.

3 points

Question 10

Which of the following statements about common resources is not true?

A. Due to the free-rider problem, common resources tend to be overused.

B. Because there is rivalry in the consumption of common resources, whenever one person uses a common resource it is imposing a negative externality on others who might also want to use it.

C. There are no private solutions to the management of common resources.

D. One of the solutions that ensures that common resources are properly managed is their privatization.

3 points

Question 11

In our analysis of the firmâs behavior and goals, when we talk about cost, we include _________, and when we talk about profit, we mean ________.

A. Explicit costs only; economic profit

B. Implicit costs only; economic profit

C. Implicit costs only; accounting profit

D. Explicit + implicit costs; economic profit

E. Explicit + implicit costs; accounting profit

3 points

Question 12

One of the differences between explicit and implicit costs is that

A. explicit costs must be greater than implicit costs.

B. explicit costs do not require a direct monetary outlay, whereas implicit costs do.

C. implicit costs do not require a direct monetary outlay, whereas explicit costs do.

D. implicit costs must be greater than explicit costs.

3 points

Question 13

Which of the following is FALSE:

A. If accounting profit is zero, then economic profit is negative

B. Economic profit takes cost the opportunity cost of time and capital into account

C. Economic Profit = Accounting Profit + Implicit Cost

D. Economic Profit = Accounting Profit â Implicit Cost

3 points

Question 14

Which of the following is an example of an implicit cost?

(i) the owner of a firm forgoing an opportunity to earn a large salary working in Wall Street

(ii) interest paid on the firm's debt

(iii) rent paid by the firm to lease office space

A. (ii) and (iii) only

B. (i) and (iii) only

C. (i) only

D. (iii) only

3 points

sapphirekangaroo316

1. (TCOs 2, 4, 5, 6) The idea that the assisted suicide of terminally ill patients should be allowed simply at the patient's direction reflects what type of ethics? (Points: 5)

Hobbes' State of Nature
Rand's Objectivism
Aristotle's concept of Virtue
Thomas Aquinas' concept of conscience
Socrates' concept of excellence

Question 2.2. (TCOs 1, 2, 7) What is the moral ideal of compassion? (Points: 5)

Acts of unmerited kindness
Sentiment in response to the suffering of others
Acknowledging the sufferings of others
Acts of altruism
Acts contrary to Objectivism

Question 3.3. (TCOs 1, 2) One of the common errors in Ethics is that of the double standard. The double standard consists of what? (Points: 5)

Discriminating in the application of ethical criteria based on our own preferences
Setting aside ethical criteria in special cases
Taking steps to avoid condemnation of others
Using one set of criteria for judging cases concerning ourselves and another for all others
Suspending judgment when concerned that the consequences would be too severe

Question 4.4. (TCO 2) Prescriptive language is commonly used in ethics for what reason? (Points: 5)

To indicate what is prohibited or impossible
To indicate that one choice is better than others
To show what actions are legal
To convey requirements and obligations
To indicate that there are really no choices available

Question 5.5. (TCOs 7, 8) Each person ought to do whatever will best promote his or her own interests. (Points: 5)

Utilitarianism
Kant's Categorical Imperative
Social Contract Theory
Ethical Egoism
Gilligan

Question 6.6. (TCOs 2, 4, 9) Free people are motivated toward forming social structures according to a social contract in order to overcome what problem identified by Thomas Hobbes? (Points: 5)

The need to overcome disagreements
A perpetual state of warfare
The establishment of a monarchy
Taxation to support the costs of government
Organized ways to select leaders

Question 7.7. (TCOs 3, 6) Agricultural biofuels are not properly a renewable source of energy in the environmental ethics debate. Which of the following also is not a renewable source of energy? (Points: 5)

Windmill turbines
Hydroelectric power
Tidal flow generators
Biomass waste systems
Solar cells

Question 8.8. (TCOs 3, 6, 7) Where in our course does the following phrase apply: 'The only thing good without qualification is a good will'? (Points: 5)

Personal habits of excellence according to Plato
The social contract according to Locke
Deontological ethics according to Mill
Natural law ethics according to Aquinas
Deontological ethics according to Kant

Question 9.9. (TCOs 8, 9) John Stuart Mill's theory of Utilitarianism is the most common form of ethics in use today. It is used so commonly because it belongs to which of the Primary Schools of Ethics? (Points: 5)

Care-based
Ends-based
Economy-based
Law-based
Efficiency-based

Question 10.10. (TCOs 3, 6, 7) What is the purpose of proving whether a syllogism of formal logic is 'valid'? (Points: 5)

To identify the connecting phrase 'therefore' or a synonym of it before proceeding further
To determine whether the situation described is accurate
To determine whether the premises are true before continuing
To determine whether the conclusion proceeds from the premises
To determine that there are only two premise statements in the syllogism

Question 11.11. (TCOs 1, 2) Solving a dilemma involves realizing what aspect of it? (Points: 5)

You will never be satisfied that the right choice was made
Some choices of action are more realistic than others
In deciding to choose one action, the other possible choices will be lost
Not everybody involved will be happy with the choice
There may be significant personal costs to choosing

Question 12.12. (TCOs 1, 2, 7) According to Thomas Aquinas, what ethical capacity do people of every culture naturally possess? (Points: 5)

Logical thinking
Personal virtues
Self-interest
Ability to learn lessons
Conscience

Question 13.13. (TCOs 2, 8) The single criterion for making decisions in utilitarian ethics is what? (Points: 5)

The experience of pleasure
Accounting for unintended consequences
Fiduciary interests to be honored
The amount of happiness produced
The principle to be honored

Question 14.14. (TCOs 1, 2, 5) The world view of ruthless and unending competition for property and wealth was spelled out in which of these concepts? (Points: 5)

Locke's notion of the natural state of man
Rawls' notion of the veil of ignorance
Aristotle's notion of the doctrine of the mean
Hammurabi's code of law
Hobbes' state of nature

Question 15.15. (TCOs 3, 6, 7) Which school of ethics is primarily applied as a practical matter through rights and duties? (Points: 5)

Objectivism
Normative ethics
Consequentialist ethics
Deontological ethics
Interdisciplinary ethics

Question 16.16. (TCOs 2, 7, 8) Personal development and discovery through the repetition of good acts and study of virtue characterize what ethicist? (Points: 5)

Plato
Aristotle
Luther
Augustine
Socrates

Question 17.17. (TCOs 2, 8) Professional societies with codes of ethics and conduct enforce what standard on members beyond the paying of dues? (Points: 5)

Not to engage in other businesses for profit outside of the profession
Personal standards of behavior for family members
Pricing structures for services
Non-competition among members
Meeting ethical and competency standards in order to practice within a jurisdiction

Question 18.18. (TCOs 2, 7) Aristotle's Ethical Doctrine of the Mean measured personal virtues on a scale that included the virtue itself, the excess of it, and the deficiency of it.

If the virtue is GENEROSITY, and the excess is WASTEFULNESS, what is the deficiency?

(Points: 5)

Carefulness
There is no deficiency
Being broke (having no money)
Stinginess
Moderation

Question 19.19. (TCOs 8, 9) Processes and systems designed to slow down disagreeing behavior and think situations through more deliberately are called (Points: 5)

value clarification processes.
conflict resolution systems.
objectivist tactics.
primary schools of ethics.
care-based ethics.

Question 20.20. (TCOs 1, 2) The Latin term a priori describes the origin of knowledge developed rationally, and the term a posteriori describes knowledge developed through observation and experience. What is produced through a priori rational thought that applies to ethics? (Points: 5)

Analysis systems
Principles of ethics
Concern for outcomes
Emotions
Subjective sense of identity

goldmuskrat363

Q3. The assumption of rational self-interest implies that people will choose to enrich themselves even if doing so violates the rights or property of others.

a. true

b. false

Q4. If you can earn $10 an hour as a retail clerk, $12 an hour as an office assistant, $16 an hour as a house painter, and $20 an hour repairing bicycles, what is your opportunity cost of working to repair bicycles?

a. $12 an hour

b. $10 an hour

c. $20 an hour

d. $16 an hour

Q5. In the graph of a production possibilities curve, both the horizontal and vertical axes measure the annual quantities of goods produced.

a. true

b. false

Q6. Scarcity arises because

a. international companies are slow to explore for new resources.

b. resources are finite and unable to meet all human wants and needs.

c. many countries waste goods because of inefficient political systems.

d. import taxes retard production.

Q7. A production possibilities curve with clothing and food on the axes shows which of the following?

I. A society cannot have an unlimited amount of each good.

II. For an efficient society, an increase in clothing production will necessitate a decrease in food production.

III. A society will always produce the maximum amount of both clothing and food.

a. II only

b. I only

c. III only

d. both I and II

Q8. All points on the production possibilities curve are efficient.

a. true

b. false

Q9. Economic growth can be pictured in a production possibilities curve diagram by

a. shifting the production possibilities curve out.

b. moving from right to left along the curve.

c. moving from left to right along the curve.

d. shifting the production possibilities curve in.

Q10. Suppose the current unemployment rate is 15 percent. If it rises to 20 percent,

a. the production possibilities curve will shift inward.

b. the economy will move closer to the production possibilities curve.

c. the economy will operate further inside the production possibilities curve.

d. the economy will move up along the production possibilities curve.

Q11. Clean air is a scarce resource.

a. true

b. false

Q12. Which of the following statements is FALSE?

a. A good is anything that gives satisfaction or happiness to individuals.

b. Wants may include humanitarian and altruistic goals.

c. Wants are unlimited and include all material and nonmaterial desires.

d. Economic goods are available in desired quantities at a zero price.

Q13. The current size of the U.S. labor force is less than 100 million workers.

a. true

b. false

Q14. The factors of production are

a. never as useful as people expect them to be.

b. valuable only because they are owned by corporations seeking to make a profit from them.

c. scarce resources.

d. abundant without limit on the planet.

Q15. Why do firms seek to use the least-cost combination of inputs?

a. because they won't be able to stay in business if they don't

b. because that is the combination that their employees prefer

c. because managers and supervisors find their jobs are easiest when the least-cost combination is used

d. because they want to keep costs low in order to appear to the media as a well-run business

Q16. Which one of the following best describes how economists view prices?

a. Low prices are good; high prices are bad.

b. High prices are good; low prices are bad.

c. The best price is a fair price.

d. Prices are signals of relative scarcity.

Q17. The person who creates a product innovation and brings it to market is providing the resource of

a. labor.

b. land.

c. entrepreneurship.

d. capital.

Q18. Gifts of nature used in the production process are considered

a. entrepreneurship.

b. labor.

c. land.

d. capital.

Q19. In a free market economy,

a. government decides what is produced, and producers decide who gets to consume it.

b. as a good becomes relatively more scarce, its price declines.

c. firms choose only to produce the most fashionable goods, regardless of the cost of production.

d. goods and services are allocated by a price system.

Q20. Resources are also known as

a. stocks, bonds, and other financial instruments.

b. minerals.

c. factors of production.

d. factories.

Q21. The size of the U.S. labor force has declined over the past 20 years as many jobs have been outsourced from the United States to other countries.

a. true

b. false

Q22. Which one of the following is TRUE?

a. The growth of the U.S. population over the next several decades will come from immigration.

b. Population growth makes a country poorer, because there are more mouths to feed.

c. Real per capita GDP can increase only if there is inflation.

d. Real per capita GDP can increase only if there is no inflation.

Q23. Which one of the following is FALSE?

a. The U.S. labor force will continue to grow through immigration.

b. Inflation stops economic growth.

c. Increased availability of reliable communication channels at lower and lower costs have led to companies relocating their manufacturing operations offshore.

d. The size of the U.S. labor force continues to grow despite many jobs being moved off-shore.

Q24. What is the purpose of a market system?

a. to facilitate efficient exchange

b. to encourage consumers to buy goods on credit

c. to ensure an equal distribution of income

d. to ensure that everyone is treated fairly

Q25. The market system is also called the price system because

a. people pay money in markets.

b. everything has a price tag.

c. rising prices are the signal to producers to make more of a particular good.

d. inflation is a disturbing problem.

Q26. Production refers to

a. any activity that causes a material conversion of an object.

b. any activity that results in the conversion of resources into goods and services that can be consumed.

c. any activity carried on by a firm, whether a corporation, partnership, or sole proprietorship.

d. physically producing material goods only.

Q27. An increase in the price of coffee, holding other things constant, will

a. decrease the demand for coffee.

b. increase the demand for coffee.

c. decrease the quantity of coffee demanded.

d. decrease the supply of coffee.

Q28. The supply curve shifts when the firm experiences a change in its production technology.

a. true

b. false

Q29. A surplus results when the quantity supplied exceeds the quantity demanded.

a. true

b. false

Q30. Table 3.1

Price per Constant-Quality Unit Quantity Demanded of Constant-Quality Units per Year Quantity Supplied of Constant-Quality Units per Year

$1.00 1,000 200

2.00 800 400

3.00 600 600

4.00 400 800

5.00 200 1,000

What condition characterizes a surplus?

a. Quantity supplied exceeds quantity demanded.

b. Quantity demanded exceeds quantity supplied.

c. Consumers are unhappy with the price.

d. Producers are unhappy with the price.

Q31. An increase in quantity demanded is caused by

a. an increase in income.

b. a decrease in the price of a complement.

c. a change in expectations about price in the future.

d. a decrease in the price of the good.

Q32. The demand curve is downward sloping because

a. price and quantity have a direct relationship.

b. price is always constant.

c. demand is based on supply.

d. price and quantity have an inverse relationship.

Q33. An increase in the price of one good will decrease the demand for a substitute good.

a. true

b. false

Q34. The market demand curve is the vertical summation of the demand curves of all the individuals in the market.

a. true

b. false

Q35. The equilibrium price of a good is a price that everyone is happy with.

a. true

b. false

Q36. Which one of the following would cause a rightward shift of the supply curve?

a. A new tax is imposed on production of the good.

b. Some firms that have been producing the good go out of business.

c. Firms producing the good find ways of lowering their production costs.

d. There is an increase in demand for the good.

Q37. Which of the following is a determinant of demand?

a. cost of production

b. number of suppliers

c. technology of production

d. income

Q38. The market demand curve for a particular good

a. will not be affected by any of the determinants of individual demand.

b. is the horizontal sum of each individual demand curve for the good.

c. will show a direct relationship between price and quantity demanded.

d. may be less than an individual demand curve for the good.

Q39. Table 4.4

Quantity of CDs Purchased Total Utility Marginal Utility

1 75

2 135

3 185

4 35

5 25

6 15

According to Table 4.4, what is the total utility when six CDs are purchased?

a. 65

b. 260

c. 120

d. 220

Q40. A rational consumer will never purchase a product when its

a. marginal utility is decreasing.

b. total utility is decreasing.

c. marginal utility is slightly positive.

d. marginal utility is negative.

Q41. The price elasticity of demand becomes relatively greater as more substitutes are easily available.

a. true

b. false

Q42. Which of the following statements is true with respect to total utility and marginal utility?

a. Marginal utility is always equal to total utility.

b. Total utility will always be negative when marginal utility is positive.

c. Total utility is minimized when marginal utility is zero.

d. Marginal utility can decline as total utility rises.

Q43. Table 4.3

Quantityof Soda Marginal Utility of Soda Quantityof Pizza Marginal Utility of Pizza

1 50 1 100

2 25 2 80

3 0 3 60

4 -25 4 40

After consuming what quantity of soda does the consumer in Table 4.3 experience diminishing marginal utility?

a. 2

b. 3

c. 1

d. 4

Q44. If the price elasticity of demand is 0.5, a 10 percent increase in the price will cause

a. the quantity demanded to decrease by 20 percent.

b. the quantity demanded to decrease by 50 percent.

c. the quantity demanded to increase by 50 percent.

d. the quantity demanded to decrease by 5 percent.

Q45. Which one of the following would make the demand for satellite subscription TV relatively less elastic?

a. The cost of administering the satellite service is lowered.

b. Cable TV service becomes less widely available.

c. Other networks of wireless entertainment become more widely available.

d. The cost of transmitting satellite signals is lowered.

Q46. A price increase will cause a relatively large drop in quantity demanded when

a. demand is perfectly inelastic.

b. the price elasticity of demand is 0.

c. there is very little time allowed for consumers to react.

d. the consumer has easy access to a number of substitute goods.

Q47. Table 4.6

Price Quantity Demanded

$20 90

$16 110

$12 130

$ 8 150

According to the data in Table 4.6, what is the elasticity of demand between a price of $20 and a price of $16?

a. 0.60

b. 0.75

c. 0.90

d. 1.25

Q48. Price elasticity of demand is the responsiveness

a. of the quantity demanded to changes in supply.

b. of the quantity demanded to changes in income.

c. of the quantity demanded to changes in price.

d. of the quantity demanded to changes in quantity.

Q49. Everyone who views the latest adventure movie in theaters will derive the same utility from seeing it.

a. true

b. false

Q50. The law of diminishing marginal utility asserts that total utility becomes negative when marginal utility begins to diminish.

a. true

b. false

FARE 1300 Lecture Notes - Lecture 6: Bill 78 (Quebec, 2012)

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