Southwest Tennessee Community College Specific Public Good Externality Comparative Essay

(Part 1)) Outline a specific public good and does it solve a positive or negative externality.

Describe a free rider problem of the public good you chose.

(Part 2) Write a narrative essay (minimum of 1200 words) which addresses the questions and statements below . A minimum of three scholarly sources are required, and all sources should be cited and referenced in APA format.

1. Give an example of each of the following:
   a. A good that is rivalrous in consumption and is excludable.
   b. A good that is nonrivalrous in consumption and is excludable.
   c. A good that is rivalrous in consumption and is nonexcludable.
   d. A good that is nonrivalrous in consumption and is nonexcludable.
2. Identify each of the following as an adverse selection or a moral hazard problem
   a. A person with car insurance fails to lock his car doors when he shops at a mall.
   b. A person with a family history of cancer purchases the most complete health coverage available.
   c. A person with health insurance takes more risks on the ski slopes of Aspen than he would without health insurance.
   d. A college professor receives tenure (assurance of permanent employment) from her employer.
   e. A patient pays his surgeon before she performs the surgery.
3. Using the data in the accompanying table, answer the fol- lowing questions:
   
   a. For which good does Canada have a comparative advantage?
   b. For which good does Italy have a comparative advantage?
   c. What might be a set of favorable terms of trade for the two countries?
   d. Prove that both countries would be better off in the specialization-trade case than in the no-specialization-no-trade case.
4. In the accompanying figure,
   
   PW is the world price and PW + T is the world price plus a tariff. Identify the following:
   a. The level of imports at PW
   b. The level of imports at PW + T
   c. The loss in consumers’ surplus as a result of a tariff
   d. The gain in producers’ surplus as a result of a tariff
   e. The revenue received as a result of a tariff
   f. The net loss to society as a result of a tariff
   g. The net benefit to society of moving from a tariff to no tariff