Chapter 20 : Sustainable Development

MULTIPLE CHOICE
1. Which British economist predicted that continued population growth would bring the world to
disaster?
a. John Stuart Mill
c. Adam Smith
b. David Ricardo
d. Thomas Malthus
ANS: D
MSC: Factual

DIF: Easy

REF: 757

TOP: Sustainable Development

2. Statistical estimations suggest that pollution peaks at what level of income per capita?
a. $5,000 to $8,000
c. $21,000 to $24,000
b. $13,000 to $16,000
d. $29,000 to $32,000
ANS: A
DIF: Medium
REF: 759
TOP: Will Economic Growth Save or Destroy the Environment?
MSC: Factual
3. The relationship between levels of pollution and levels of income generally follows an inverted-U
shape and is commonly called the:
a. pollution-level Laffer curve.
c. sustainability Lorenz curve.
b. environmental Kuznets curve.
d. atmospheric Engel curve.
ANS: B
DIF: Medium
REF: 759
TOP: Will Economic Growth Save or Destroy the Environment?
MSC: Factual
4. Which organization declared the requirement that consumption by todays generation must be
accompanied by sufficient conservation of resources to protect the future generations ability to
consume as well?
a. Brundtland Commission
c. Millennium Project
b. The Club of Rome
d. The Earth Institute
ANS: A
DIF: Easy
REF: 761
TOP: Concept and Measurement of Sustainable Development

MSC: Factual

5. The combination of produced capital, natural capital, and intangible capital make up which of the
following terms?
a. complete wealth
c. comprehensive wealth
b. total assets
d. comprehensive resources
ANS: C
DIF: Medium
REF: 761
TOP: Concept and Measurement of Sustainable Development

MSC: Factual

6. The ________ suggests that a sustainable development path for countries that depend on nonrenewable
resources requires the rents from those resources to be continually invested rather than consumed.
a. Hartwick rule
c. Malthus theory
b. Solow growth model
d. Ricardo rule
ANS: A

DIF: Medium

REF: 761

TOP: Concept and Measurement of Sustainable Development

MSC: Factual

7. Adjusted net saving is equal to gross saving minus both the depreciation of made capital and the
depreciation of:
a. resource surpluses.
c. trade assets.
b. natural capital.
d. reserve capital.
ANS: B
DIF: Medium
TOP: Saving for a Sustainable Future

REF: 765
MSC: Factual

8. Which of the following are characteristics of common-pool resources (CPRs)?

a. It is difficult to exclude anyone from using them.
b. Use by one person reduces the availability of that resource for use by others.
c. CPRs cannot be governed or regulated.
d. Both a and b.
ANS: D
DIF: Easy
TOP: Externalities and the Commons

REF: 770
MSC: Factual

9. The socially optimal outcome is achieved when the owner of property rights is a(n) ________ and sells
output in a competitive market.
a. experienced manager
c. skilled land owner
b. profit-maximizer
d. wealthy investor
ANS: B
MSC: Factual

DIF: Medium

REF: 773

TOP: Property Rights

10. Public disclosure of information about a factorys environmental performance to local stake holders is
an example of:
a. informal regulation.
c. unofficial guidelines.
b. formal regulation.
d. transparency parameters.
ANS: A
MSC: Factual

DIF: Easy

REF: 781

TOP: Informal Regulation

11. Fragile environments of the world are largely populated by the worlds:
a. rich.
c. industrialized population.
b. poor.
d. developed economies.
ANS: B
MSC: Factual

DIF: Easy

REF: 782

TOP: Policy Failures

12. Which of the following is a function of forest income in rural livelihoods?

a. safety nets to help compensate production shortfalls
b. support for current consumption
c. a source of income growth
d. all of the above
ANS: D
DIF: Medium
TOP: Poverty-Environment Linkages

REF: 785
MSC: Factual

13. As of 2006, which country overtook the United States as the worlds leading source of carbon dioxide
emissions?
a. India
c. Russia
b. China
d. Japan
ANS: B
MSC: Factual

DIF: Easy

REF: 792

TOP: Global Climate Change

14. Response to the potential threats from global climate change requires simultaneous action on which
two fronts?
a. interception and adjustment
c. alleviation and treatment
b. mitigation and adaptation
d. easing and restoration
ANS: B
MSC: Factual

DIF: Easy

REF: 792

TOP: Global Climate Change

15. The incremental cost of achieving a lower target in the amount of change in global temperature is a
form of:
a. climate insurance.
c. weather price.
b. atmosphere protection.
d. global cooling fee.
ANS: A
MSC: Factual

DIF: Easy

REF: 792

TOP: Global Climate Change

SHORT ANSWER
IDs and Paired-Concept Questions
These terms can be used individually as short-answer identification questions, or they can be used in
pairs. In the latter case, ask students to explain (1) the meaning and significance of each of the two
terms and (2) the relationship between them.
1. Pollution, greenhouse gases
ANS:
Answer will vary
2. Resource rent, depletion
ANS:
Answer will vary
3. Present value, optimal target
ANS:
Answer will vary
4. Payments for environmental services (PES) programs, marketable permits
ANS:
Answer will vary
5. Common-pool resources, nonrenewable resource

ANS:
Answer will vary
6. Marginal abatement cost, optimal pollution
ANS:
Answer will vary
7. Malthusian trap, neoclassical theory
ANS:
Answer will vary
8. Adjusted net saving, sustainable growth
ANS:
Answer will vary
9. Pollution, rich countries
ANS:
Answer will vary
10. Natural capital, intangible capital
ANS:
Answer will vary