Economic Quiz
It’s one hour quiz
I did the first attempt, you could check the answer I got correct and you just need to help me find the correct answers which I didn‘t got
QUESTION 1
1.
Alternative approaches for reducing carbon dioxide emissions are
|
burning low carbon coal and deforestation. |
|
carbon taxes and carbon scrubbing. |
|
carbon taxes and carbon trading. |
|
carbon trading and carbon subsidies. |
2 points
QUESTION 2
1.
The Coase Theorem asserts that
|
if trade in an externality is possible and there are low transaction costs, bargaining will lead to an efficient outcome regardless of the initial allocation of property rights. |
|
Bargaining between the parties to an external cost of production can never lead to an efficient market solution to deal with the externality. |
|
there is no solution to the problem of market externalities |
|
the government must always directly intervene with a command and control policy to deal effectively with a negative externality such as pollution. |
2 points
QUESTION 3
1.
Which of the following displays these two characteristics: nonrivalry and nonexcludability in consumption?
|
quasi- public goods |
|
common resources |
| public goods |
|
private goods |
2 points
QUESTION 4
1.
Which of the following is not an advantage of risk pooling?
|
Individuals who are insured and therefore do not have to pay the full cost of health care services may be inclined to over-use those services. |
|
It is easier for an insurance company to estimate the average number of claims likely to be filed under a group policy than it is to predict the number of claims likely to be filed under an individual policy. |
|
It gives very sick people in the group the same access to health care and to pay the same premiums as healthy individuals. |
|
By insuring large groups as opposed to individuals, health insurance providers reduce adverse selection. |
2 points
QUESTION 5
1.
The cost of group health insurance is lower than if an individual buys a policy on his own because
|
insuring a group eliminates the problem of buyers having more information than the seller. |
|
moral hazard costs of a group tend to move to a low average. |
|
it is easier for the company to deny claims from a large group. |
|
the problem of adverse selection is reduced. |
2 points
QUESTION 6
1.
Some environmentalists are skeptical about the appointment of Judge Amy Coney Barrett to the Supreme Court and her interpretation of Administrative Law because:
|
She said that she is very knowledgeable about climate science in her Senate testimony |
|
She graduated from Harvard and is therefore biased |
|
She might uphold the court’s decision in Massachusetts vs. EPA |
|
Climate change wasn’t included in the original mandate of the EPA, and Congress has never explicitly told the agency to regulate greenhouse gas emissions, |
2 points
QUESTION 7
1.
The demand curve for a public good is also called the
|
total welfare curve. |
|
total willingness-to-pay curve. |
|
marginal social benefit curve. |
|
total social benefit curve. |
2 points
QUESTION 8
If a Pigouvian tax is larger than what it costs a firm to clean up its pollution emissions, then the firm will generally choose to clean up its emissions rather than pay the Pigouvian tax.
|
True |
|||
|
False |
2 points
QUESTION 9
1.
Referring to figure 5-7 above, and assume that we are trying to reduce carbon emissions. If poor forest management caused the recent California Wildfires, then that would mean:
|
the Marginal Benefit of Reducing Pollution curve shifts to the left (decreases) if the wildfires had little to do with carbon emissions. |
|
the efficient level of pollution reduction is QA |
|
there is no way to estimate the benefits and costs of carbon emission reduction, so this framework is only theoretical. |
|
the efficient level of pollution reduction is QE |
2 points
QUESTION 10
1.
Health insurance companies impose deductibles on policies and co-payments on claims
|
to reduce moral hazard problems. |
|
to increase sales. |
|
to reduces sunk costs. |
|
to increase prices. |
2 points
QUESTION 11
1.
Social Security Disability Insurance (SSDI) and Supplemental Security Insurance programs, the US government provides disability insurance to all, providing monthly income to the disabled through (in the case of SSDI) premiums levied on the healthy. The government does this because:
|
it has pushed out private insurers in this market. |
|
when all group members (workers) pay the premium, the problem of adverse selection is reduced. |
|
such insurance does not meet the criteria for an incomplete market. |
|
the US Constitution mandates all citizens to buy social insurance. |
2 points
QUESTION 12
1.
Conceptually, the efficient level of carbon emissions is the level for which
|
the marginal benefit of reducing carbon emissions is maximized. |
|
the marginal benefit of reducing carbon emissions is minimized and the marginal cost of reducing carbon emissions is maximized. |
|
the marginal benefit of reducing carbon emissions is equal to the marginal cost of reducing carbon emissions. |
|
the marginal cost of reducing carbon emissions is minimized. |
2 points
QUESTION 13
1.
According to former Labor Secretary Robert Reich the administrative costs of Medicare for All would be much higher than private insurance.
True
False
2 points
QUESTION 14
1.
The social benefit of a given level of a public good is the vertical sum of all private benefits for that level.
|
2. |
2 points
QUESTION 15
1.
The Pre-Existing Condition Insurance Plan is a federally administered part of the Affordable Care Act, and is designed for people with pre-existing medical conditions to obtain insurance. By offering health insurance to all U.S. citizens with pre-existing medical conditions, the Pre-Existing Condition Insurance Plan eliminates ________ for both the insurer and the insured, and eliminates ________ for the issuer of the insurance policy.
|
asymmetric information; adverse selection |
|
moral hazard; adverse selection |
|
adverse selection; the principal-agent problem |
|
the principal-agent problem; moral hazard |
2 points
QUESTION 16
1.
According to Mariana Mazzucato the positive externality of a COVID vaccine is large enough to cover the cost of the investment needed to provide a vaccine that would be provided at no charge to the public (i.e., free for all who want it in the US and the Rest of the World).
True
False
2 points
QUESTION 17
1.
Unlike the Affordable Care Act, Medicare for All would provide universal health care coverage for all Americans
True
False
2 points
QUESTION 18
1.
A carbon tax which is designed to reduce pollution is an example of a
|
government administrative rule. |
|
noneffective incentive. |
|
market-based policy. |
2 points
QUESTION 19
1.
In a market with negative externalities (e.g. large-scale meat packing and offshore oil exploration), equilibrium price does not reflect full marginal social cost, and like a subsidy, this leads to excessive production and consumption of the good.
True
False
2 points
QUESTION 20
1.
Mariana Mazzucato draws connections between government spending on general purpose technologies (GPTs) and increases in innovation for consumer products. She asserts that:
|
public sector spending should never add to the size of the government deficit |
|
government spending is a complement, not a substitute, for private sector investments. |
|
public sector spending is too large as a proportion of Gross Domestic Product |
|
government spending crowds out private investment spending. |
2 points
QUESTION 21
1.
In economics, the term “free rider” refers to
|
a supervisor who delegates menial time-consuming activities to others. |
|
one who waits for others to produce a good and then enjoys its benefits without paying for it. |
|
a person who evades taxes. |
|
one who volunteers her services. |
2 points
QUESTION 22
1.
Chicken pox vaccinations for toddlers benefit society by protecting young children and by preventing an epidemic of the disease. Thus, the social benefits of chicken pox vaccinations exceed the private benefit for any quantity of vaccinations as illustrated in Figure 5-10.
Refer to Figure 5-10.
One way to obtain the economically efficient amount of chicken pox vaccinations is for governments to subsidize these vaccinations. What is the size of the per-vaccination Pigovian subsidy that the government must provide to internalize the external benefits?
|
( PE – PG) |
| PE |
|
PF |
|
(PE – PF) |
2 points
QUESTION 23
Suppose a negative externality exists in a market. If transactions costs are low and parties are willing to bargain then, according to the Coase theorem
|
an efficient solution can be reached only if property rights are assigned to the victims of the pollution. |
|
an efficient solution can be reached regardless of the initial assignment of property rights. |
|
government intervention is critical to reach an efficient solution. |
|
an efficient solution can be reached only if property rights are assigned to the polluters. |
2 points
Attempt 1 correct and wrong answer, the form of question 9 and 22 can be found in above part
· Question 1
0 out of 2 points
| Alternative approaches for reducing carbon dioxide emissions are |
|
Selected Answer: carbon taxes and carbon scrubbing. |
· Question 2
2 out of 2 points
| The Coase Theorem asserts that |
|
Selected Answer: if trade in an externality is possible and there are low transaction costs, bargaining will lead to an efficient outcome regardless of the initial allocation of property rights. |
· Question 3
0 out of 2 points
| Which of the following displays these two characteristics: nonrivalry and nonexcludability in consumption? |
|
Selected Answer: quasi-public goods |
· Question 4
2 out of 2 points
| Which of the following is not an advantage of risk pooling? |
|
Selected Answer: Individuals who are insured and therefore do not have to pay the full cost of health care services may be inclined to over-use those services. |
· Question 5
0 out of 2 points
| The cost of group health insurance is lower than if an individual buys a policy on his own because |
|
Selected Answer: moral hazard costs of a group tend to move to a low average. |
· Question 6
2 out of 2 points
| Some environmentalists are skeptical about the appointment of Judge Amy Coney Barrett to the Supreme Court and her interpretation of Administrative Law because: |
|
Selected Answer: Climate change wasn’t included in the original mandate of the EPA, and Congress has never explicitly told the agency to regulate greenhouse gas emissions, |
· Question 7
2 out of 2 points
| The demand curve for a public good is also called the |
|
Selected Answer: marginal social benefit curve. |
· Question 8
2 out of 2 points
| If a Pigouvian tax is larger than what it costs a firm to clean up its pollution emissions, then the firm will generally choose to clean up its emissions rather than pay the Pigouvian tax. | |||
|
Selected Answer: True |
· Question 9
0 out of 2 points
| Referring to figure 5-7 above, and assume that we are trying to reduce carbon emissions. If poor forest management caused the recent California Wildfires, then that would mean: |
|
Selected Answer: the efficient level of pollution reduction is QA |
· Question 10
2 out of 2 points
| Health insurance companies impose deductibles on policies and co-payments on claims |
|
Selected Answer: to reduce moral hazard problems. |
· Question 11
2 out of 2 points
| Social Security Disability Insurance (SSDI) and Supplemental Security Insurance programs, the US government provides disability insurance to all, providing monthly income to the disabled through (in the case of SSDI) premiums levied on the healthy. The government does this because: |
|
Selected Answer: when all group members (workers) pay the premium, the problem of adverse selection is reduced. |
· Question 12
2 out of 2 points
| Conceptually, the efficient level of carbon emissions is the level for which |
|
Selected Answer: the marginal benefit of reducing carbon emissions is equal to the marginal cost of reducing carbon emissions. |
· Question 13
2 out of 2 points
| According to former Labor Secretary Robert Reich the administrative costs of Medicare for All would be much higher than private insurance. | |
|
Selected Answer: False |
· Question 14
2 out of 2 points
| The social benefit of a given level of a public good is the vertical sum of all private benefits for that level. |
· Question 15
0 out of 2 points
| The Pre-Existing Condition Insurance Plan is a federally administered part of the Affordable Care Act, and is designed for people with pre-existing medical conditions to obtain insurance. By offering health insurance to all U.S. citizens with pre-existing medical conditions, the Pre-Existing Condition Insurance Plan eliminates ________ for both the insurer and the insured, and eliminates ________ for the issuer of the insurance policy. |
|
Selected Answer: moral hazard; adverse selection |
· Question 16
0 out of 2 points
| According to Mariana Mazzucato the positive externality of a COVID vaccine is large enough to cover the cost of the investment needed to provide a vaccine that would be provided at no charge to the public (i.e., free for all who want it in the US and the Rest of the World). |
· Question 17
2 out of 2 points
| Unlike the Affordable Care Act, Medicare for All would provide universal health care coverage for all Americans |
· Question 18
2 out of 2 points
| A carbon tax which is designed to reduce pollution is an example of a |
|
Selected Answer: market-based policy. |
· Question 19
2 out of 2 points
| In a market with negative externalities (e.g. large-scale meat packing and offshore oil exploration), equilibrium price does not reflect full marginal social cost, and like a subsidy, this leads to excessive production and consumption of the good. |
· Question 20
0 out of 2 points
| Mariana Mazzucato draws connections between government spending on general purpose technologies (GPTs) and increases in innovation for consumer products. She asserts that: |
|
Selected Answer: public sector spending is too large as a proportion of Gross Domestic Product |
· Question 21
2 out of 2 points
| In economics, the term “free rider” refers to |
|
Selected Answer: one who waits for others to produce a good and then enjoys its benefits without paying for it. |
· Question 22
0 out of 2 points
|
Chicken pox vaccinations for toddlers benefit society by protecting young children and by preventing an epidemic of the disease. Thus, the social benefits of chicken pox vaccinations exceed the private benefit for any quantity of vaccinations as illustrated in Figure 5-10.
Refer to Figure 5-10. |
|
Selected Answer: (PE – PF) |
· Question 23
2 out of 2 points
| Suppose a negative externality exists in a market. If transactions costs are low and parties are willing to bargain then, according to the Coase theorem |
|
Selected Answer: an efficient solution can be reached regardless of the initial assignment of property rights. |