PUP 3002 Exam Questions with
Correct Answers
What are the features of the good model? Tag all that apply - ANSWER-logically
consistent
parsimonious
Falsifiable
If X is getting a driving license, and Y is going on a roadtrip by yourself, what type of
condition is X for Y - ANSWER-necessary
When we describe a person as making a rational decision in terms of personal utility
maximization, we are saying that they - ANSWER-made a choice that reflects their
attempt to optimize their personal utility
Students who receive funding from Florida Bright Futures lose their funding if they
fail to make good grades. The legislature justifies this as a - ANSWER-commitment
device
A Nash Equilibrium - ANSWER-reveals each players' best response given the other
player's action
Commitment problems exist - ANSWER-where parties cannot credibly commit to a
strategy despite its high utility
Game Theory - ANSWER-is used to study strategic decision-making
a discount factor - ANSWER-measures the extent to which people discount future
benefits relative to current ones
ordinal preferences - ANSWER-order preferences according to assigned values to
outcomes that convey only relative order, but not total magnitude
To say a person has a weak preference suggests that they - ANSWER-prefer or
indifferent between one quantity, say A, and another, say B
In a 2 by 2 Prisoner's Dilemma game, each players worst preferred outcome -
ANSWER-is the opposite of their best preferred outcome
The present value of benefits - ANSWER-measures what a benefit in the future is
worth to you today
What focuses on what the state of the world should be? - ANSWER-Normative
criteria
, A(n) _____ is any institution or operation wherein individuals can trade goods,
services, or information. - ANSWER-market
If the beneficiaries of a proposed alternative could hypothetically compensate those
who are likely to be made worse off, then we may obtain a - ANSWER-Kaldor-Hicks
improvement
Which of the following is a determinant of supply? - ANSWER-technology
When a tax is placed on power plants to have them realize the costs associated with
their pollution, what type of market failure is the government addressing? -
ANSWER-negative externality
What type of good's use or consumption will limit or eliminate the supply of that
specific good to others? - ANSWER-A rivalrous good
_____ is a situation where some incident has caused the market price to be either
higher or lower than the price that would have been obtained in the presence of a
perfectly competitive market. - ANSWER-a market distortion
A monopoly market describes a situation where a good or service has many buyers
and has how many sellers? - ANSWER-one
The Food and Drug Administration (FDA) requires food contents be marked on the
outside of the package so the consumer can make a more informed decision about
what to buy. What type of solution is the government using in this example? -
ANSWER-regulation
Elinor Ostrom's approach to manage common pool resources is based on -
ANSWER-Markets and government in combination
The group that is used as a baseline measure for an experiment and does not
receive the experimental manipulation is referred to as - ANSWER-the control group
An experiment is unable to reveal a valid causal effect due to a set of factors that are
correlated with both the treatment and the potential outcome. Bias in this experiment
is likely to result from - ANSWER-confounding variables
A researcher gathers data on air pollution and rates of lung disease in a number of
communities. The researcher, then, attempts to draw a causal inference based on
the variation in air pollution and lung disease rates across the different communities.
What type of analysis is the researcher conducting? - ANSWER-an observational
study
If I had studied one more hour for my Public Policy exam, would I have received a
better grade? Asking oneself this question is an example of what concept? -
ANSWER-counterfactual
A correlation can - ANSWER-reveal whether two variables are associated
Correct Answers
What are the features of the good model? Tag all that apply - ANSWER-logically
consistent
parsimonious
Falsifiable
If X is getting a driving license, and Y is going on a roadtrip by yourself, what type of
condition is X for Y - ANSWER-necessary
When we describe a person as making a rational decision in terms of personal utility
maximization, we are saying that they - ANSWER-made a choice that reflects their
attempt to optimize their personal utility
Students who receive funding from Florida Bright Futures lose their funding if they
fail to make good grades. The legislature justifies this as a - ANSWER-commitment
device
A Nash Equilibrium - ANSWER-reveals each players' best response given the other
player's action
Commitment problems exist - ANSWER-where parties cannot credibly commit to a
strategy despite its high utility
Game Theory - ANSWER-is used to study strategic decision-making
a discount factor - ANSWER-measures the extent to which people discount future
benefits relative to current ones
ordinal preferences - ANSWER-order preferences according to assigned values to
outcomes that convey only relative order, but not total magnitude
To say a person has a weak preference suggests that they - ANSWER-prefer or
indifferent between one quantity, say A, and another, say B
In a 2 by 2 Prisoner's Dilemma game, each players worst preferred outcome -
ANSWER-is the opposite of their best preferred outcome
The present value of benefits - ANSWER-measures what a benefit in the future is
worth to you today
What focuses on what the state of the world should be? - ANSWER-Normative
criteria
, A(n) _____ is any institution or operation wherein individuals can trade goods,
services, or information. - ANSWER-market
If the beneficiaries of a proposed alternative could hypothetically compensate those
who are likely to be made worse off, then we may obtain a - ANSWER-Kaldor-Hicks
improvement
Which of the following is a determinant of supply? - ANSWER-technology
When a tax is placed on power plants to have them realize the costs associated with
their pollution, what type of market failure is the government addressing? -
ANSWER-negative externality
What type of good's use or consumption will limit or eliminate the supply of that
specific good to others? - ANSWER-A rivalrous good
_____ is a situation where some incident has caused the market price to be either
higher or lower than the price that would have been obtained in the presence of a
perfectly competitive market. - ANSWER-a market distortion
A monopoly market describes a situation where a good or service has many buyers
and has how many sellers? - ANSWER-one
The Food and Drug Administration (FDA) requires food contents be marked on the
outside of the package so the consumer can make a more informed decision about
what to buy. What type of solution is the government using in this example? -
ANSWER-regulation
Elinor Ostrom's approach to manage common pool resources is based on -
ANSWER-Markets and government in combination
The group that is used as a baseline measure for an experiment and does not
receive the experimental manipulation is referred to as - ANSWER-the control group
An experiment is unable to reveal a valid causal effect due to a set of factors that are
correlated with both the treatment and the potential outcome. Bias in this experiment
is likely to result from - ANSWER-confounding variables
A researcher gathers data on air pollution and rates of lung disease in a number of
communities. The researcher, then, attempts to draw a causal inference based on
the variation in air pollution and lung disease rates across the different communities.
What type of analysis is the researcher conducting? - ANSWER-an observational
study
If I had studied one more hour for my Public Policy exam, would I have received a
better grade? Asking oneself this question is an example of what concept? -
ANSWER-counterfactual
A correlation can - ANSWER-reveal whether two variables are associated
