Question 1

A Middle Eastern country has an oil reserve that it can extract for a profit of $50 a barrel today, $55 a barrel in two years, $60 a barrel in three years, and $65 in four years. The current market rate of interest is 10 percent. When should this country tap into its oil reserve to obtain the most profit per barrel in present value terms?

Accepted Answer

A)  two years
B)  three years
C)  four years
D)  todayE) A) and B)
F) A) and C)

Question 2

The graph shows the extraction costs for TX Oil Company in the first year in a situation where it will extract oil from a reserve over two years. If user costs increase, then the total cost line will

Accepted Answer

A)  stay the same and the extraction cost line will shift upward.
B)  shift upward and the extraction cost line will shift downward.
C)  shift upward and the extraction cost line will shift upward.
D)  shift upward and the extraction cost line will stay the same.E) A) and B)
F) C) and D)

Question 3

Petroleum is the largest source of electric energy generated in the U.S.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following, in order, describes the three steps of the demographic transition?

Accepted Answer

A)  low birthrates and death rates; high birthrates and low death rates; high birthrates and death rates
B)  high birthrates and death rates; low birthrates and high death rates; low birthrates and death rates
C)  high birthrates and low death rates; high birthrates and death rates; low birthrates and death rates
D)  high birthrates and death rates; high birthrates and low death rates; low birthrates and death ratesE) B) and D)
F) A) and B)

Question 5

Many demographers expect world population to

Accepted Answer

A)  increase exponentially into the foreseeable future.
B)  decline from its current level in the next two decades.
C)  peak around 9.5 billion and then decline.
D)  plateau at around 7.5 billion and then start to increase rapidly.E) All of the above
F) C) and D)

Question 6

The Malthusian prediction of Paul Ehrlich in The Population Bomb in 1968 proved to be wrong because population growth

Accepted Answer

A)  slowed dramatically as standards of living decreased.
B)  slowed dramatically as standards of living increased.
C)  rose dramatically as standards of living decreased.
D)  rose dramatically as standards of living increased.E) B) and D)
F) B) and C)

Question 7

The long-run fall of commodity prices implies that commodity supplies have grown

Accepted Answer

A)  faster than the rate of productivity in the economy.
B)  more slowly than total resource consumption.
C)  faster than total resource consumption.
D)  more slowly than the inflation rate.E) A) and C)
F) B) and C)

Question 8

If per-capita energy usage has leveled off while per capita GDP has risen, then it must mean that each dollar of output produced required a larger amount of energy.

Accepted Answer

A) True 
 B)False

Question 9

The table shows the quantity of gold bars in thousands, the extraction cost for each thousand bars (in millions of dollars) , and the user cost of each thousand bars (in millions of dollars) facing the OZ Mining Company this year. Suppose that a new government regulation is going to shut down OZ's mining operation one year from now. Assuming that all gold extracted is sold in the same year (cannot be stockpiled for later sale) , how will the regulation affect the user cost?

Accepted Answer

A)  It will have no effect on the user cost.
B)  The effect on the user cost cannot be determined.
C)  The user cost will rise because the rate of extraction will rise.
D)  The user cost will become zero because they will not be able to extract in the future.E) All of the above
F) A) and B)

Question 10

Refer to the diagram, representing Slippery Slope Oil Company. What is the user cost of extracting a barrel of oil this year?

Accepted Answer

A)  $20
B)  $40
C)  $50
D)  $70E) A) and C)
F) A) and B)

Question 11

A total fertility rate of 1.0 will cause the

Accepted Answer

A)  population to remain stable.
B)  population to double in one generation.
C)  population to collapse in one generation.
D)  next generation to be half the size of the current generation.E) C) and D)
F) B) and C)

Question 12

Encouraging conservation is especially difficult in the open ocean, where it is impossible to either define or enforce property rights over fish.

Accepted Answer

A) True 
 B)False

Question 13

The higher a resource's current price, the more extraction should be delayed to a later period.

Accepted Answer

A) True 
 B)False

Question 14

About one-half of U.S. electricity is generated using petroleum.

Accepted Answer

A) True 
 B)False

Question 15

Recent studies indicate that as the price of a barrel of oil rises to $80, the use of biodiesel as an alternative fuel becomes economically viable.

Accepted Answer

A) True 
 B)False

Question 16

Individual transferable quotas are limited in their effectiveness because

Accepted Answer

A)  they are only enforceable within 200 miles of a nation's shores.
B)  government, rather than the market, sets their price.
C)  they encourage wasteful spending by fishers in ITQ areas.
D)  they are not tradable.E) A) and C)
F) A) and D)

Question 17

Compare the real cost of commodity resources today with their cost in the 1845-1850 period. What explains the change?

Accepted Answer

The real cost of commodities is about 60...

Question 18

Renewable energy sources account for about 50 percent of U.S. electricity generation.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following is true regarding the famous bet about future resource prices, made between Paul Ehrlich and Julian Simon?

Accepted Answer

A)  Ehrlich predicted resource prices would increase; Simon predicted they would fall. Ehrlich won the bet.
B)  Ehrlich predicted resource prices would increase; Simon predicted they would fall. Simon won the bet.
C)  Ehrlich predicted resource prices would decrease; Simon predicted they would rise. Simon won the bet.
D)  Ehrlich predicted resource prices would decrease; Simon predicted they would rise. Ehrlich won the bet.E) All of the above
F) A) and D)

Question 20

Which one of the following statements is true? The fertility rates for major industrialized countries in recent years show that Malthus's theory regarding population is

Accepted Answer

A)  valid because high standards of living have produced higher birthrates.
B)  valid because high standards of living have produced lower birthrates.
C)  invalid because high standards of living have produced higher birthrates.
D)  invalid because high standards of living have produced lower birthrates.E) A) and D)
F) None of the above

Exam 19: Natural Resource and Energy Economics

The Malthusian prediction of Paul Ehrlich in The Population Bomb in 1968 proved to be wrong because population growth

Correct Answer
verified

Which of the following, in order, describes the three steps of the demographic transition?

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Individual transferable quotas are limited in their effectiveness because

Correct Answer
verified

Recent studies indicate that as the price of a barrel of oil rises to $80, the use of biodiesel as an alternative fuel becomes economically viable.

Correct Answer
verified

Refer to the diagram, representing Slippery Slope Oil Company. What is the user cost of extracting a barrel of oil this year?

Correct Answer
verified

Which of the following is true regarding the famous bet about future resource prices, made between Paul Ehrlich and Julian Simon?

Correct Answer
verified

Encouraging conservation is especially difficult in the open ocean, where it is impossible to either define or enforce property rights over fish.

Correct Answer
verified

A total fertility rate of 1.0 will cause the

Correct Answer
verified

If per-capita energy usage has leveled off while per capita GDP has risen, then it must mean that each dollar of output produced required a larger amount of energy.

Correct Answer
verified

The long-run fall of commodity prices implies that commodity supplies have grown

Correct Answer
verified

Many demographers expect world population to

Correct Answer
verified

Renewable energy sources account for about 50 percent of U.S. electricity generation.

Correct Answer
verified

Petroleum is the largest source of electric energy generated in the U.S.

Correct Answer
verified

Which one of the following statements is true? The fertility rates for major industrialized countries in recent years show that Malthus's theory regarding population is

Correct Answer
verified

Compare the real cost of commodity resources today with their cost in the 1845-1850 period. What explains the change?

Correct Answer
verified
The real cost of commodities is about 60...
View Answer

The graph shows the extraction costs for TX Oil Company in the first year in a situation where it will extract oil from a reserve over two years. If user costs increase, then the total cost line will

Correct Answer
verified

The higher a resource's current price, the more extraction should be delayed to a later period.

Correct Answer
verified

About one-half of U.S. electricity is generated using petroleum.

Correct Answer
verified

Exam 19: Natural Resource and Energy Economics

The Malthusian prediction of Paul Ehrlich in The Population Bomb in 1968 proved to be wrong because population growth

Correct AnswerverifiedShow Answer

Which of the following, in order, describes the three steps of the demographic transition?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Individual transferable quotas are limited in their effectiveness because

Correct AnswerverifiedShow Answer

Recent studies indicate that as the price of a barrel of oil rises to $80, the use of biodiesel as an alternative fuel becomes economically viable.

Correct AnswerverifiedShow Answer

Refer to the diagram, representing Slippery Slope Oil Company. What is the user cost of extracting a barrel of oil this year?

Correct AnswerverifiedShow Answer

Which of the following is true regarding the famous bet about future resource prices, made between Paul Ehrlich and Julian Simon?

Correct AnswerverifiedShow Answer

Encouraging conservation is especially difficult in the open ocean, where it is impossible to either define or enforce property rights over fish.

Correct AnswerverifiedShow Answer

A total fertility rate of 1.0 will cause the

Correct AnswerverifiedShow Answer

If per-capita energy usage has leveled off while per capita GDP has risen, then it must mean that each dollar of output produced required a larger amount of energy.

Correct AnswerverifiedShow Answer

The long-run fall of commodity prices implies that commodity supplies have grown

Correct AnswerverifiedShow Answer

Many demographers expect world population to

Correct AnswerverifiedShow Answer

Renewable energy sources account for about 50 percent of U.S. electricity generation.

Correct AnswerverifiedShow Answer

Petroleum is the largest source of electric energy generated in the U.S.

Correct AnswerverifiedShow Answer

Which one of the following statements is true? The fertility rates for major industrialized countries in recent years show that Malthus's theory regarding population is

Correct AnswerverifiedShow Answer

Compare the real cost of commodity resources today with their cost in the 1845-1850 period. What explains the change?

Correct AnswerverifiedThe real cost of commodities is about 60...View AnswerShow Answer

The graph shows the extraction costs for TX Oil Company in the first year in a situation where it will extract oil from a reserve over two years. If user costs increase, then the total cost line will

Correct AnswerverifiedShow Answer

The higher a resource's current price, the more extraction should be delayed to a later period.

Correct AnswerverifiedShow Answer

About one-half of U.S. electricity is generated using petroleum.

Correct AnswerverifiedShow Answer

Correct Answer
verified

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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The real cost of commodities is about 60...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified