Question 1

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 2

Commercially run forestry companies that have secure property rights over their trees

Accepted Answer

A)   harvest them as soon as possible and replant them when they are harvested.
B)   harvest them as soon as possible and do not replant them when they are harvested.
C)   do not harvest them as soon as possible and do replant them when they are harvested.
D)   do not harvest them as soon as possible and do not replant them when they are harvested.E) A) and C)
F) None of the above

Question 3

Higher interest rates will, all else equal,

Accepted Answer

A)   increase the extraction cost of a resource.
B)   increase the user cost of extracting a resource.
C)   reduce the user cost of extracting a resource.
D)   have no impact on either the user cost or extraction cost of a resource.E) All of the above
F) None of the above

Question 4

Matt fishes for tuna at a cost of $4 per ton. John fishes at a cost of $6 per ton. Each has a 1,000-ton ITQ. The current market price is $8 per ton. What amount could Matt pay John to induce him to sell his ITQ?

Accepted Answer

A)   $1,000
B)   $2,000
C)   $3,000
D)   It would not be profitable for Matt to buy John's ITQ.E) A) and D)
F) None of the above

Question 5

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) B) and D)
F) A) and B)

Question 6

An energy company has recently discovered a natural gas reserve. The company can tap this reserve at a cost of $350,000 and obtain a profit of $450,000 in three years. The current market rate is 15 percent. Should the company make the investment?

Accepted Answer

A)   Yes, the future value of the profit is greater than the present value of the cost.
B)   No, the future value of the profit is less than the present value of the cost.
C)   Yes, the present value of the profit is greater than the present value of the cost.
D)   No, the present value of the profit is less than the present value of the cost.E) All of the above
F) None of the above

Question 7

According to data from the UN Food and Agriculture Organization, which of the following nations had the fastest growing area of forested land in the period 2010-2015?

Accepted Answer

A)   Brazil
B)   United States
C)   Nigeria
D)   IcelandE) A) and B)
F) A) and C)

Question 8

One major reason why the survival of elephants is threatened is that

Accepted Answer

A)   villages near elephants have high unemployment.
B)   governments have overtaxed elephant safaris.
C)   there is a lack of incentive for elephant preservation.
D)   the number of tourists interested in elephants has declined.E) A) and B)
F) A) and C)

Question 9

Commodity-pricing data from The Economist show a dramatic long-run decline in 25 important real commodity prices from 1850 to 2015. This decline primarily occurred because the

Accepted Answer

A)   demand for commodities decreased drastically.
B)   supply of commodities grew faster than demand.
C)   demand for commodities has remained stable over the years.
D)   supply of commodities increased, while demand increased even more.E) All of the above
F) A) and B)

Question 10

Which of the following best describes the typical growth pattern of trees for logging?

Accepted Answer

A)   Trees grow slowly at first, then grow exponentially until cut down.
B)   Trees grow quickly at first, then continue to grow at a declining rate.
C)   Trees grow quickly at first, then plateau for a time before resuming an exponential growth pattern.
D)   Trees grow slowly at first, quickly in the middle years, and then at a diminishing rate into old age.E) B) and C)
F) None of the above

Question 11

Because wind turbines supply no energy on windless days, and solar power is only generated when the sun is up and out, one inherent problem with both wind and solar power is the

Accepted Answer

A)   government subsidy problem.
B)   zero-emissions problem.
C)   energy storage problem.
D)   oil-complementarity problem.E) A) and C)
F) A) and B)

Question 12

ITQs both limit catches and encourage fishing in the least costly way.

Accepted Answer

A) True 
 B)False

Question 13

According to the concept of present value, a $50 barrel of oil today is worth

Accepted Answer

A)   less than a $50 barrel in 2 years.
B)   more than a $50 barrel in 2 years.
C)   the same as a $50 barrel in 2 years.
D)   the same as a $50 barrel in 2 years, but only if there is no inflation during those 2 years.E) All of the above
F) A) and D)

Question 14

Demographers predict that declines in birthrates are in part due to

Accepted Answer

A)   more strict adherence to religious beliefs and practices regarding human reproduction.
B)   fewer career opportunities for women in many societies.
C)   the increased expense of raising a child in modern societies.
D)   falling standards of living in many countries around the world.E) B) and D)
F) B) and C)

Question 15

If the world runs out of oil, it will also run out of energy.

Accepted Answer

A) True 
 B)False

Question 16

A British thermal unit is the amount of energy required to raise the temperature of one liter of water by one degree Celsius.

Accepted Answer

A) True 
 B)False

Question 17

The primary focus of energy economics is how

Accepted Answer

A)   energy consumption is increasing.
B)   energy production is decreasing.
C)   people deal with the scarcity of energy.
D)   people conserve crude oil for future use.E) All of the above
F) A) and D)

Question 18

As technologies improve, the costs of producing alternatives will likely fall, reducing the cost of replacing oil.

Accepted Answer

A) True 
 B)False

Question 19

Profit-maximizing extraction companies will attempt to

Accepted Answer

A)   extract resources as quickly as possible.
B)   delay extraction as long as possible.
C)   find rates of extraction that maximize the flow of profits over time.
D)   extract resources at a constant rate every year to minimize price fluctuations.E) A) and D)
F) All of the above

Question 20

Which of the following nations, as of 2015, has a total fertility rate that would suggest that its next generation will be just over half the size of the current generation?

Accepted Answer

A)   Hong Kong
B)   Australia
C)   Sweden
D)   all of these nationsE) A) and B)
F) A) and C)

Exam 19: Natural Resource and Energy Economics

Which of the following nations, as of 2015, has a total fertility rate that would suggest that its next generation will be just over half the size of the current generation?

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

Commodity-pricing data from The Economist show a dramatic long-run decline in 25 important real commodity prices from 1850 to 2015. This decline primarily occurred because the

Correct AnswerverifiedShow Answer

An energy company has recently discovered a natural gas reserve. The company can tap this reserve at a cost of $350,000 and obtain a profit of $450,000 in three years. The current market rate is 15 percent. Should the company make the investment?

Correct AnswerverifiedShow Answer

Profit-maximizing extraction companies will attempt to

Correct AnswerverifiedShow Answer

Because wind turbines supply no energy on windless days, and solar power is only generated when the sun is up and out, one inherent problem with both wind and solar power is the

Correct AnswerverifiedShow Answer

Commercially run forestry companies that have secure property rights over their trees

Correct AnswerverifiedShow Answer

The primary focus of energy economics is how

Correct AnswerverifiedShow Answer

According to data from the UN Food and Agriculture Organization, which of the following nations had the fastest growing area of forested land in the period 2010-2015?

Correct AnswerverifiedShow Answer

According to the concept of present value, a $50 barrel of oil today is worth

Correct AnswerverifiedShow Answer

Higher interest rates will, all else equal,

Correct AnswerverifiedShow Answer

One major reason why the survival of elephants is threatened is that

Correct AnswerverifiedShow Answer

Individual transferable quotas are limited in their effectiveness because

Correct AnswerverifiedShow Answer

ITQs both limit catches and encourage fishing in the least costly way.

Correct AnswerverifiedShow Answer

Matt fishes for tuna at a cost of $4 per ton. John fishes at a cost of $6 per ton. Each has a 1,000-ton ITQ. The current market price is $8 per ton. What amount could Matt pay John to induce him to sell his ITQ?

Correct AnswerverifiedShow Answer

As technologies improve, the costs of producing alternatives will likely fall, reducing the cost of replacing oil.

Correct AnswerverifiedShow Answer

Which of the following best describes the typical growth pattern of trees for logging?

Correct AnswerverifiedShow Answer

If the world runs out of oil, it will also run out of energy.

Correct AnswerverifiedShow Answer

A British thermal unit is the amount of energy required to raise the temperature of one liter of water by one degree Celsius.

Correct AnswerverifiedShow Answer

Demographers predict that declines in birthrates are in part due to

Correct AnswerverifiedShow Answer

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