Question

1) Which of the following would be the best example of a public good?

a) Clean water at the public lake.

b) A community park.

c) Snowplowing the streets.

d) Public school.

2) Which of the following is the best example of a public good with exclusion?

a) A fireworks display that can be seen miles away.

b) Fire protection services offered by the city.

c) Satellite radio service.

d) A public lake.

3) Which of the following best represents a tragedy of the commons?

a) A shopping mall with no shoppers inside.

b) A severe traffic jam on the freeway.

c) A fire that burns an entire apartment complex.

d) A ski resort that has closed due to lack of snow.

4) Which of the following represents the best example of a free-rider?

a) Your roommate asking you for a ride to school but will not help out with gas.

b) A panhandler who sneaks onto the subway without paying.

c) A person without health insurance visiting an emergency room since they cannot be turned away.

d) A neighbor who plants vegetables in her garden and allows others to help themselves to her harvest.

5) Generally, the amount of public goods available in a society is _____ what is actually desired.

a) greater than

b) less than

c) exactly

d) either exactly or greater than

Please answer all of the questions and explain each answer!

Thank you.

Answer 1

1) Which of the following would be the best example of a public good?

Solution: snowplowing the streets

Explanation: Snow plowing categorised as a public good or common resource. Once a street is plowed, it will not be excludable

2) Which of the following is the best example of a public good with exclusion?

Solution: Satellite radio service

Explanation: The public goods are non-excludable and non-rivalrous, however there are certain public goods such as satellite radio service to exclude users

3) Which of the following best represents a tragedy of the commons?

Solution: A severe traffic jam on the freeway

Explanation: The tragedy of the commons refers to an issue that occurs when people exploit a shared resource to the extent that demand overwhelms supply and the resource becomes unavailable to few or all.

4) Which of the following represents the best example of a free-rider?

Solution: A person without health insurance visiting an emergency room because they can't be turned away

Explanation: The free-rider problem occurs when individuals who gains from resources, goods, or services do not pay for them, thus creating an under-provision of those goods or services

5) Generally, the amount of public goods available in a society is _____ what is actually desired

Solution: less than

Explanation: It is often viewed that public goods are available in a society lesser than what is actually desired