10.1 externalities of production

1、单选题：
​The term market failure refers to‌
选项：
A: a.     a market that fails to allocate resources efficiently.
B: b.   an unsuccessful advertising campaign which reduces demand.
C: c.    ruthless competition among firms.
D: d.   a firm that is forced out of business because of losses.
答案: 【 a.     a market that fails to allocate resources efficiently.】

2、单选题：
​An externality is the impact of​
选项：
A: a.    society’s decisions on the well-being of society.
B: b.   a person’s actions on that person’s well-being.
C: c.    one person’s actions on the well-being of a bystander.
D: d.   society’s decisions on the poorest person in the society.
答案: 【 c.    one person’s actions on the well-being of a bystander.】

3、单选题：
​Research into new technologies‏
选项：
A: a.    provides positive externalities because it creates knowledge others can use.
B: b.   results in negative externalities because government funding for research causes less government spending in other areas.
C: c.    is protected by patent laws, which eliminates the need for government intervention.
D: d.   should only be funded by the corporations that will receive the profits from the research.
答案: 【 a.    provides positive externalities because it creates knowledge others can use.】

4、单选题：
‌The supply curve for a product reflects the‎
选项：
A: a.    willingness to pay of the marginal buyer.
B: b.   quantity buyers will ultimately purchase of the product.
C: c.    cost to sellers of producing the product.
D: d.   seller’s profit from producing the product.
答案: 【 c.    cost to sellers of producing the product.】

5、单选题：
​When a negative externality exists in a market, the cost to producers‎​‎
选项：
A: a.    is greater than the cost to society.
B: b.   will be the same as the cost to society.
C: c.    will be less than the cost to society.
D: d.     will differ from the cost to society, regardless of whether an externality is present.
答案: 【 c.    will be less than the cost to society.】

10.2 externalities of consumption and solutions to externalities

1、单选题：
‍Negative externalities occur when one person’s actions​
选项：
A: a.    cause another person to lose money in a stock market transaction.
B: b.   cause his or her employer to lose business.
C: c.    reveal his or her preference for foreign-produced goods.
D: d.   adversely affect the well-being of a bystander who is not party to the action.
答案: 【 d.   adversely affect the well-being of a bystander who is not party to the action.】

2、单选题：
​         When a market is characterized by an externality, the government‌
选项：
A: a.    can correct the market failure only in the case of positive externalities.
B: b.   can correct the market failure only in the case of negative externalities.
C: c.    can correct the market failure in the case of both positive and negative externalities by inducing market participants to internalize the externality.
D: d.   cannot correct for externalities due to the existence of patents.
答案: 【 c.    can correct the market failure in the case of both positive and negative externalities by inducing market participants to internalize the externality.】

3、单选题：
​Which of the following statements is correct?‌
选项：
A: a.    Government should tax goods with either positive or negative externalities.
B: b.   Government should tax goods with negative externalities and subsidize goods with positive externalities.
C: c.    Government should subsidize goods with either positive or negative externalities.
D: d.   Government should tax goods with positive externalities and subsidize goods with negative externalities.
答案: 【 b.   Government should tax goods with negative externalities and subsidize goods with positive externalities.】

4、单选题：
‌Suppose that elementary education creates a positive externality. If the government does not subsidize education, then‏‌‏
选项：
A: a.    the equilibrium quantity of education will be equal the socially optimal quantity of education.
B: b.   the equilibrium quantity of education will be greater than the socially optimal quantity of education.
C: c.    the equilibrium quantity of education will be less than the socially optimal quantity of education.
D: d.   There is not enough information to answer the question.
答案: 【 c.    the equilibrium quantity of education will be less than the socially optimal quantity of education.】

5、单选题：
‍What is the difference between command-and-control policies and market-based policies toward externalities?​‍​
选项：
A: a.    Command-and-control policies provide incentives for private decision makers to solve the problems on their own, whereas market-based policies regulate behavior directly.
B: b.   Command-and-control policies rely on taxes, whereas market-based policies rely on quotas.
C: c.    Command-and-control policies regulate behavior directly, whereas market-based policies provide incentives for private decision makers to change their behavior.
D: d.   Command-and-control policies are efficient, whereas market-based policies are inefficient.
答案: 【 c.    Command-and-control policies regulate behavior directly, whereas market-based policies provide incentives for private decision makers to change their behavior.】

11.public goods and common resources

1、单选题：
‌A good is excludable if‎‌‎
选项：
A: a.    one person’s use of the good diminishes another person’s enjoyment of it.
B: b.   the government can regulate its availability.
C: c.    it is not a normal good.
D: d.   people can be prevented from using it. 
答案: 【 d.   people can be prevented from using it. 】

2、单选题：
​When one person uses a common resource, such as fish in the ocean, which of the following would not be correct?‎
选项：
A: a.    Other people are likely to be worse off.
B: b.   Other people will not be compensated for their loss.
C: c.    The person does not account for external effects.
D: d.   There will still be enough left for other people, since one person cannot make a major impact.
答案: 【 d.   There will still be enough left for other people, since one person cannot make a major impact.】

3、单选题：
‌Too few resources are devoted to the creation of knowledge because profit-seeking firms​
选项：
A: a.    undervalue knowledge in their pursuit of revenues.
B: b.   overuse their patents.
C: c.      tend to free-ride on the knowledge that others have developed.
D: d.   tend to rely on existing employee knowledge.
答案: 【 c.      tend to free-ride on the knowledge that others have developed.】

4、单选题：
‏The commercial value of ivory is a threat to the elephant, but the commercial value of beef is a guardian of the cow. This is because‌‏‌
选项：
A: a.    the cow is raised in developed countries, while the elephant lives primarily in less-developed countries.
B: b.   cows are private goods, while elephants tend to roam freely without owners.
C: c.    cows and elephants are public goods, but ivory is nonrival.
D: d.   ivory is nonrival and nonexclusive, but beef is rival and exclusive.
答案: 【 b.   cows are private goods, while elephants tend to roam freely without owners.】

5、单选题：
​         National defense is provided by the government because‌
选项：
A: a.    it is impossible for private markets to produce public goods.
B: b.   products provided by the government are produced more efficiently.
C: c.    free-riders make it difficult for private markets to supply the socially optimal quantity.
D: d.   public goods increase government revenues. 
答案: 【 c.    free-riders make it difficult for private markets to supply the socially optimal quantity.】

13.1 production function and cost

1、单选题：
‍Economists normally assume that the goal of a firm is to‌‍(i)  sell as much of their product as possible.‌‍(ii) set the price of their product as high a