____________ arises when there is no market for a good or service because of the absence of property rights.

A marginal spill-over
An externality
A marginal cost
An emission charge

In the absence of property rights, a factory will dump waste into a waterway up to the point where its _________________.

marginal benefit is maximized
total benefit is maximized
marginal benefit equals marginal social cost
marginal revenue equals marginal cost

A large farming operation which uses a potent fertilizer is located upriver from a trout farmer. If property rights of the river exist and transactions costs are low, the level of pollution will be _________________.

always inefficient
efficient if either the farming operation or the trout farmer own the river
inefficient if the farming operation owns the river
efficient only if the trout farmer owns the river

A country has several factories that emit sulfur dioxide. The government may be able to overcome the accompanying environment externalities by all of the following except ___________.

emission charges
private negotiation with each factory
marketable permits
taxes

One reason why pollution rates in some developing countries are high is that ____________.

the citizens do not care about global warming
the government subsidizes the use of coal or oil
the citizens are misinformed
producers have increased marginal costs

The knowledge that you gain from your economics course is _________________.

a consumer good and a factor of production
a marginal cost
a consumer good
a factor of production

When people determine the quantity of education they will undertake, they _______ the external benefits. As a result, if education were left to an unregulated market, people would undertake too _______ education.

undervalue; little
overvalue; much
undervalue; much
overvalue; little

Governments can achieve an efficient allocation of resources in the presence of external benefits from education and research and development through all of the following items except _______________.

scholarships
patents and copyrights
subsidies
below-cost provision

Knowledge __________________.

does not display diminishing marginal productivity
creates external costs
like other factors of production, has diminishing marginal productivity
and the use of computers do not have diminishing marginal productivity

The use of a patent incurs an economic cost because the owner is a _______________.

monopoly
monopoly that sets the price below the marginal cost of production
monopoly that produces the competitive quantity of the good
monopoly that sets the price equal to the marginal cost of production