Question

1. Without government intervention, public goods tend to be

a. underproduced and common resources tend to be under-consumed.

b. overproduced and common resources tend to be overconsumed

c. overproduced and common resources tend to be under-consumed.

d. underproduced and common resources tend to be overconsumed.

 

2. Which of the following pairs of goods includes a good that is excludable and rival in consumption as well as a good that is not excludable and not rival in consumption?

a. congested non-toll road, national defense

b. tablet computer, a gym membership at a gym that always has plenty of open equipment and classes

c. online music subscription, streetlight

d. tablet computer, national defense

 

3. Which of the following is a lesson from the Condorcet paradox?

a. Majority voting always indicates what outcome a society really wants.

b. Under certain conditions, there is no scheme for aggregating individual preferences.

c. When there are more than two options, deciding the order in which to vote can have a powerful influence over the outcome of an election.

d. If voters are choosing a point along a line, then the majority rule will pick the most preferred point of the median voter.