Question : 11) For which type of good it necessary to sum : 1241095

11) For which type of good is it necessary to sum the marginal benefit curves vertically in order to obtain the economy’s marginal benefit curve?

A) public goods

B) mixed goods

C) private goods

D) goods that are subject to the exclusion principle

E) common resources

12) Suppose a public good is provided in an economy with only two consumers, Popeye and Captain Hook. If Popeye values the public good at $4,000 per year, and Captain Hook values it at $3,000 per year, the economy’s marginal benefit of the public good per year is

A) $7,000.

B) $4,000.

C) $3,000.

D) $1,000.

E) $12,000.

13) The marginal benefit of a public good ________ as more of the good is produced.

A) increases

B) decreases

C) stays the same

D) None of the above is correct because the marginal benefit could increase, decrease, or not change depending on whether the marginal cost increases, decreases, or does not change as more is produced.

E) None of the above is correct because the marginal benefit could increase, decrease, or not change depending on whether more, fewer, or the same number of people consume the good as more is produced.

14) As more of a public good is produced, the marginal benefit of each additional unit ________ and as more of a private good is produced, the marginal benefit of each additional unit ________.

A) increases; increases

B) increases; decreases

C) decreases; increases

D) decreases; decreases

E) does not change; does not change

15) Marginal cost curves for public goods are usually

A) downward sloping.

B) upward sloping.

C) horizontal.

D) vertical.

E) U-shaped.

16) A library is a public good. The marginal cost curve for libraries in Lafayette, California

A) has a negative slope.

B) is definitely a horizontal line.

C) has a positive slope.

D) is a vertical line.

E) is identical to the marginal benefit curve because libraries are nonrival.

17) To determine the efficient quantity of a public good to supply,

A) the private firms that will produce the good each produce the exact same quantity.

B) marginal benefit and marginal cost are equated, the same as is done to determine the efficient quantity of a private good.

C) total benefit is equated to total cost, the same as is done to determine the efficient quantity of a private good.

D) politicians use the principle of maximum differentiation.

E) marginal benefit must exceed marginal cost by as much as possible.

18) Which of the following represents an efficient quantity of a public good?

A) the quantity at which the marginal cost of production is minimized

B) the quantity at which the number of free riders is maximized

C) the quantity at which the marginal benefit minus marginal cost is minimized

D) the quantity at which the marginal benefit is equal to the marginal cost

E) the quantity at which the marginal benefit exceeds the marginal cost by the maximum amount possible

19) The efficient quantity of a public good is the quantity at which marginal benefit is

A) greater than marginal cost by any amount.

B) less than marginal cost.

C) equal to marginal cost.

D) zero.

E) greater than marginal cost by the maximum amount.

20) To achieve the efficient level of national defense,

A) the government could provide national defense because it is a public good.

B) private firms can provide national defense because it is a private good.

C) the government can provide national defense because it is a private good.

D) the government can provide national defense because it is a common resource.

E) None of the above answers is correct.