Question 1

Total allowable catch policies and individual transferable quotas both

Accepted Answer

A)   limit catch sizes and promote efficiency.
B)   limit catch sizes, but TACs promote inefficiency.
C)   promote efficiency, but only TACs limit catch sizes.
D)   promote efficiency, but only ITQs limit catch sizes.E) None of the above
F) A) and D)

Question 2

Linda fishes for mahi mahi at a cost of $10 per ton, while Tessa fishes at a cost of $8 per ton. Both have one 1,000-ton ITQ, and the current market price is $13 per ton. If Linda offered to sell her ITQ to Tessa for $3,000, she and Tessa would

Accepted Answer

A)   make the sale because they're both better off.
B)   not make the sale, because Linda is better off and Tessa is not.
C)   not make the sale, because Tessa is better of and Linda is not.
D)   not make the sale, because neither is better off.E) C) and D)
F) None of the above

Question 3

Energy efficiency requires that we employ

Accepted Answer

A)   only the lowest-cost energy inputs.
B)   only domestic energy sources.
C)   a mix of energy inputs, some of which are more expensive than others.
D)   imported energy inputs and save domestic resources for future use.E) All of the above
F) A) and C)

Question 4

Thomas Malthus argued that increases in living standards tend to reduce birthrates.

Accepted Answer

A) True 
 B)False

Question 5

The optimal extraction level in the present for a nonrenewable resource is

Accepted Answer

A)   zero.
B)   where the market price of the resource equals the extraction cost of the last unit.
C)   where the market price of the resource equals the extraction cost of the last unit plus the user cost of the last unit.
D)   where the extraction cost of the last unit equals the user cost of the last unit.E) A) and C)
F) A) and D)

Question 6

An example of a renewable resource would be

Accepted Answer

A)   oil.
B)   coal.
C)   iron ore.
D)   aquifers.E) A) and B)
F) B) and C)

Question 7

From 1950 to 2014, according to data from the U.S. Energy Information Administration, the ratio of real GDP to energy consumption in the United States has been

Accepted Answer

A)   relatively constant.
B)   slowly decreasing.
C)   decreasing steeply.
D)   rising significantly.E) A) and B)
F) B) and D)

Question 8

Renewable natural resources can never be exhausted.

Accepted Answer

A) True 
 B)False

Question 9

Mining of "conflict diamonds" tends to

Accepted Answer

A)   be more profitable, as warring factions are willing to pay more for the diamonds.
B)   occur at a slower pace than would maximize the long-term stream of profits because war increases extraction costs.
C)   occur at a pace slower than would maximize the long-term stream of profits since the war disrupts production.
D)  occur at a pace faster than would maximize the long-term stream of profits since warring factions extract diamonds as quickly as possible due to fears that they may soon lose control of the diamond mines.E) B) and C)
F) None of the above

Question 10

Optimal resource allocation involves considering current and future uses, benefits, and costs.

Accepted Answer

A) True 
 B)False

Question 11

What is a tradable fishing limit that gives the holder the right to harvest a given quantity of fish during a given time period?

Accepted Answer

A)   replacement rate
B)   total allowable catch
C)   individual transferable quota
D)   government-approved fishing licenseE) B) and D)
F) All of the above

Question 12

Property rights for fish from the open ocean

Accepted Answer

A)   do not exist.
B)   are established by the United Nations.
C)   exist once the fish are sold at market.
D)   exist once the fish are caught.E) All of the above
F) None of the above

Question 13

The total fertility rate

Accepted Answer

A)   measures the average number of children that a woman is expected to have during her lifetime.
B)   exceeds the replacement rate in countries with a falling population.
C)   equals the rate of population change over time.
D)   rises as income rises.E) All of the above
F) A) and D)

Question 14

In fisheries management, ITQ stands for

Accepted Answer

A)   international transferable quota.
B)   individual transferable quota.
C)   international tuna quotas.
D)   individual trolling quotas.E) A) and D)
F) None of the above

Question 15

Which of the following is a major reason to believe that we are not likely to run out of natural resources?

Accepted Answer

A)   slower GDP growth rates
B)   declining birthrates
C)   more renewable resources
D)   rising mortality or death ratesE) A) and B)
F) B) and C)

Question 16

The "replacement rate" is the birthrate necessary to

Accepted Answer

A)   keep a nation's population from decreasing.
B)   keep an able-bodied workforce in the economy.
C)   maintain the productivity level in an economy.
D)   maintain the standard of living of a nation.E) A) and B)
F) None of the above

Question 17

A fishery collapse

Accepted Answer

A)   necessarily happens when harvesting rates increase.
B)   necessarily happens when reproduction rates fall.
C)   occurs when harvesting outpaces reproduction for an extended period.
D)   is irreversible.E) C) and D)
F) All of the above

Question 18

The user cost of a resource is the market price paid by the buyer of the resource.

Accepted Answer

A) True 
 B)False

Question 19

Commercially run forestry companies have the most profit incentive to harvest trees from a forest

Accepted Answer

A)   early in the forest growth cycle.
B)   in the middle of the forest growth cycle.
C)   before the trees are fully mature.
D)   after the trees can no longer grow.E) A) and D)
F) A) and C)

Question 20

The world's population increased so rapidly from 1800 to the present day because of higher

Accepted Answer

A)   birthrates and lower standards of living.
B)   standards of living and higher birthrates.
C)   standards of living and lower death rates.
D)   death rates and higher standards of living.E) A) and B)
F) A) and C)

Exam 19: Natural Resource and Energy Economics

The user cost of a resource is the market price paid by the buyer of the resource.

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The "replacement rate" is the birthrate necessary to

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What is a tradable fishing limit that gives the holder the right to harvest a given quantity of fish during a given time period?

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Property rights for fish from the open ocean

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Commercially run forestry companies have the most profit incentive to harvest trees from a forest

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A fishery collapse

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The optimal extraction level in the present for a nonrenewable resource is

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Mining of "conflict diamonds" tends to

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An example of a renewable resource would be

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Energy efficiency requires that we employ

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The total fertility rate

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Which of the following is a major reason to believe that we are not likely to run out of natural resources?

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The world's population increased so rapidly from 1800 to the present day because of higher

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Linda fishes for mahi mahi at a cost of $10 per ton, while Tessa fishes at a cost of $8 per ton. Both have one 1,000-ton ITQ, and the current market price is $13 per ton. If Linda offered to sell her ITQ to Tessa for $3,000, she and Tessa would

Correct AnswerverifiedShow Answer

Optimal resource allocation involves considering current and future uses, benefits, and costs.

Correct AnswerverifiedShow Answer

Renewable natural resources can never be exhausted.

Correct AnswerverifiedShow Answer

From 1950 to 2014, according to data from the U.S. Energy Information Administration, the ratio of real GDP to energy consumption in the United States has been

Correct AnswerverifiedShow Answer

Thomas Malthus argued that increases in living standards tend to reduce birthrates.

Correct AnswerverifiedShow Answer

In fisheries management, ITQ stands for

Correct AnswerverifiedShow Answer

Total allowable catch policies and individual transferable quotas both

Correct AnswerverifiedShow Answer

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