Economics 423 -- Environmental and Natural Resources Economics (Spr. ’07)
Quiz 1, Professor Steven Hackett (KEY: Answers in bold and are underlined)
|
Price ($) |
Quantity Supplied |
Quantity Demanded |
|
100 |
3,000 |
15,000 |
|
200 |
4,000 |
14,000 |
|
300 |
5,000 |
13,000 |
|
400 |
6,000 |
12,000 |
|
500 |
7,000 |
11,000 |
|
600 |
8,000 |
10,000 |
|
700 |
9,000 |
9,000 |
|
800 |
10,000 |
8,000 |
|
900 |
11,000 |
7,000 |
|
1,000 |
12,000 |
6,000 |
1. What is the equilibrium price __700__ and quantity _9000__ in the table above?
2. At what price in the table above is there an excess demand of 6,000? __400__
3. Which of the following, if any, would usually cause equilibrium quantity to increase? (circle any/all correct answers)
Outward shift in
demand Internalizing
a positive externality
Internalizing a negative externality Inward shift in supply
4. Which of the following, if any, would usually cause equilibrium price to decrease? (circle any/all correct answers)
Outward shift in demand Internalizing a positive externality
Internalizing a negative externality Inward shift in supply
5. True/False (circle one): If there are four policy options for managing a parcel of National Forest land, then the opportunity cost of the preferred option is the SUM of the net benefits of all the other three options.
6. True/ False (circle one): Under deontological ethics, the likely consequences of an action determine the ethics of the action.
7. True/ False (circle one): Scarcity, and thus economics, is entirely an artificial construct created by capitalist enterprises, and did not exist in agrarian or hunter-gatherer societies.
8. True/ False (circle one): As the term is used in this class, economic rationality requires that people conform to the preferences and materialistic tendencies of the dominant consumer culture.
9. True/False (circle one): A public policy that is Kaldor-Hicks efficient can be made to be Pareto efficient if the policy “winners” are able to fully compensate the policy “losers.”
10. True/ False (circle one): In a market with positive externalities, the equilibrium quantity of the good generating the positive externality is too large, leading to excessive production and harms to the environment.