Environmental Policy
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Program where highly erosive cropland is planted for conservation & the government pays a farm subsidy.
CRP (Conservation Reserve Program)
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List two reasons for resource policy
Market failure, alter status quo
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Natural resource which exists in fixed quantity and which is depleted as used is called _______________ _______________.
Exhaustible Resource
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1969 federal law that requires an environmental impact assessment of any large federal project is:
National Environmental Protection Act
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What type of resource is not controlled by one user or source?
Common Property Resource
Miscellaneous
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One of the fastest recharging aquifers is the ________________ _____________.
Edwards Aquifer
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Name two characteristics of a lending, less developed nation.
Import more finished products, export raw products, high debt
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What country owes the most in debt to other countries?
U.S.
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_________ give the actual wealth to possessions owned by individuals.
Property Rights
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The state that passed the new welfare law, the law that states no more money for any additional children.
New Jersey
Property Rights

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The legal descrition system used by the Government in western United States after the Civil War was the ____________ system.
Rectangular Survey
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The U.S. constitution provides that private property cannot be taken without _______
_______.
Due Process
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A land tenure system specifies the rights people have to ________, ______, and
________ land.
Own, use, and control
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The _____ and _______ system is the prevalent legal description system used in
Texas.
Metes and bounds
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____________ provides the state with the right to take private property for public use.
Eminent Domain
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__________ provides the legal basis for the State of Texas to claim property for which there are no heirs.
Escheat
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The largest bundle of rights a private owner can hold in landed property is known as ownership in _________________ ____________.
Fee Simple
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Property rights are granted to individuals by ____________.
Society
Pollution
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Pollution in which its orientation is known is called __________.
Point Pollution
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________ is the federal agency that coordinates data gathering for water pollution nationwide.
Environmental Protection Agency (EPA)

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The gradual rise in atmospheric temperature due to increasing concentrations of CO2,
CFC’s, Methane, and other gases is called _____________.
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The greenhouse effect
The Montreal Agreement is an international accord to reduce CFC emissions to protect the earth’s ________.
Ozone Layer
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Which species of livestock generates the largest volume of waste on an annual basis nationwide?
Dairy Cattle
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According to the Journal of Animal Science, the utilization of livestock waste as a fertilizer source for crop production is limited due to the limited amount of ______ and ______ contained in the manure.
Nitrates and sodium
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The __________ provisions of the 1990 Farm Bill provide research dollars for the agricultural waste management.
Sustainable agriculture
Theory/Laws
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An allocation of a resource which maximizes the net benefit from the use of the resource satisfies the criterion of what?
Static efficiency
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An allocation of resources across n time periods that maximizes the present value of the net benefits from the use of resource satisfies the criterion of what?
Dynamic efficiency
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This criterion suggests that, at a minimum, future generations should be left not worse off than current generations.
Sustainable Criterion
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When there exists no rearrangement of an allocation of resources that would benefit some people without hurting one person.
Pareto Optimality
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A system in which no inputs are received from outside of the system and no outputs are transferred outside of the system.

Closed system
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Type of economic analysis that describes what is, what was, or what will be.
Positive economics
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Type of economic analysis that deals with what ought to be.
Normative economics
 Producer’s surplus which persists in long run competitive equilibrium is known as what?
Scarcity rent
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This occurs whenever transactions between two parties confer a benefit or cost on a third party which is not taken into account in the deliberations of the first two parties.
Externality
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This theorem suggests that as long as negotiation costs are negligible and affected consumers can negotiate freely with each other, the court can allocate the entitlement to either party and an efficient allocation will result.
Coase Theorem
Terms/Resource Types
 The natural occurrence of resources in the earth’s crust is called what?
Resource endowment
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Known resources that can profitably be extracted at current prices.
Current reserves
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A resource which is currently being used for a particular purpose, and exists in a form allowing its mass to be recovered once that purpose is no longer necessary or desirable.
Recyclable resource
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A resource whose rate of replenishment is so low that is does not offer a potential for augmenting the stock in any reasonable time frame.
Depletable resource
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A resource whose natural replenishment augments the flow of this resource at a nonnegligible rate.

Renewable resource
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Commodities which are consumed without rivalry up until some threshold at which rivalry in consumption begins are called?
Congestible goods
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A natural resource which is available for use in specific quantities per unit of time and which, if not used, is unavailable for use.
Flow resource
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A __________ population refers to one in which fertility rates yield a birth rate which is constant and equal to the death rate.
Stationary
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____________ prohibits fragile grass lands brought into production after January 1 from receiving farm program benefits.
Sodbuster
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The average amount of output produced per unit used is referred to as _________.
Average Physical Product
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Resources are divided into two groups. They are ________ and _________.
Renewable and Nonrenewable
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A resource which comes into the system in specific quantities per unit of time and which has been stored for future use.
Fund resource
Resource economics
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List the four characteristics of an efficient structure of property rights.
Clearly specified, exclusivity, transferability, and enforceability
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List the two potential sources of value to an owner of a resource in the ground.
A use value when it is sold and an asset value when it remains in the ground.
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Air pollution control costs are financed primarily by __________ while water pollution control costs are chiefly financed through __________.

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Higher product prices and the tax system
What is meant by “average physical product”?
It is the average amount of output per unit of input.
The inputs of production have been broadly classified into four general groups. What are they?
Land, labor, capital, management
A curve that reflects any combination of two inputs which results in a particular level of output is known as what?
An isoquant curve.
In regard to ultimate use of non-renewable resources, maximizing the present value of annual net returns will not lead to the depletion of these resources. Why?
Scarcity and substitutes. As price of non-renewable resources rise due to scarcity, demand will fall as further use will be uneconomical.
What is the popular name for atmospheric deposition of acidic substances.
Acid rain
What are the two types of water pollution sources?
Point and non-point sources.
As long as social and private discount rates are the same and price expectations are accurate, which forest rotation schedule will maximize net benefits?
The profit maximizing one.
List and define the two main costs associated with scarce resources.
Private costs: cost incurred by individuals using scarce resources. Social costs: cost incurred by society when a scarce resource is used.
The difference between potential supply and commercial demand at prevailing acceptable prices, higher than market-clearing prices is called?
Excess capacity
What are the two different types of natural resources?
Renewable and non-renewable

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What is the CRP?
Conservation Reserve Program. A program where highly erosive cropland is planted for a conservation use and the government pays the farmer subsidy.
What program was established to remove 45 million acres of highly erosive land from production for a ten year period?
The conservation reserve program
What program prohibits fragile grasslands brought into production after Jan. 1, 1986 from receiving farm program benefits?
Sod buster
Optimal timing of the use of resources given existing and expected technology and preferences is considered __________________.
Conservation of resources
The cost that occurs when one is trying to establish and enforce property rights are:
Transaction costs
When a landowner surrenders part of his property for development, this agreement is considered a _____________ __________________.
Development easement
A program to make land productive or more productive by changing its character like reclaiming land from the sea or swamp drainage is called _________ __________.
Land reclamation
Water rights associated with owners of land along the banks of rivers or lakes are called ____________ ______________.
Riparian Rights
Which federal agency makes and enforces regulations involving chemicals and other materials it deems as hazardous to resources?
Environmental Protection Agency
List two reasons for resource policy.
Market failure, to alter the status quo
What is the standard that prohibits any chemical residue on food or feed?

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Zero Tolerance
What term is used to describe the difference between supply and demand at prevailing acceptable prices which are higher than market clearing price?
Excess Capacity
What is the term for the policy that required that all highly erosive land have an approved conservation plan to reduce erosion by January 1, 1990?
Soil Conservation cross compliance
A cost incurred by society when a scarce resource is used is known as a ________
____________.
Social Cost
What is the term for the concept that total output can be increased if each region specializes in producing those commodities for which it has the greatest advantage or least disadvantage?
Comparative advantage
Pollution in which its orientation is known is called ______ ________.
Point Pollution
Pollution in which its source is unknown or broad is called ____ ________.
Non-point pollution
Erosion that occurs much faster than naturally occurring or geological erosion is called _____________ erosion.
Accelerated
Tilled or untilled cropland that is allowed to be idle is known as _______
__________.
Fallow land
Resource economics arises because of a/an ________ competitive market.
Imperfectly
Everything that has a price or value is considered a _______________.
Resource

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A resource that is not being regenerated or replenished by nature is called
_________.
Nonrenewable resource or exhaustible
Those resources provided by nature are called ________.
Natural Resources
The characteristic of property rights that allow rights to be exchanged from one economic agent to another is known as ___________.
Transferability
The characteristic of property rights that allow one to ban another economic agent from the use of a good is known as _________.
Exclusion
The characteristic of property right that allows one to use rules, regulations and the law to see that the right is regulated and control is _______.
Enforceability
The characteristic of property rights that states the right as known is called
_________.
Clearly specified
The holding or owning of land and all the legal rights with that arrangement is known as ____________ _________.
Land Tenure
Property rights may not be well defined because of the ___________ involved.
Costs
An economic condition in which wants exceed available resources.
Scarcity
Any approach which puts a value on a good that is not sold on the market is called
_____________.
Non-market valuation technique
Any one’s farm share of the national acreage needed to produce adequate amounts of a certain crop is called ___________.

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Acreage allotment
An _______ occurs whenever transactions between two parties confer a benefit or cost on a third party which is not taken into account in the deliberations of the first two parties.
Externality
A cost in which no cash payment is required or for which there is no cash outlay at the time the commodity is being produced.
Implicit cost
Well-developed discipline dealing with the management or husbandry of range and pasture resources is called ________________.
Range management
An ______ is a rock layer that will yield enough water to serve as a water supply for some use.
Aquifer
A market failure occurs whenever at least on of two conditions occur. What are the two conditions?
Social costs do not equal private costs; social benefits do not equal private benefits.
An area of economics concerned with the analysis of situations in which for some reason the state of the economy which would result from a perfectly competitive equilibrium cannot be achieved is called?
The theory of second best
Goods which must be supplied communally because they cannot be withheld from one individual without withholding them from all are called _____.
Public goods
In welfare economics, a change that makes at least one member of a community better off and makes none worse off is a _________ __________.
Pareto Improvement
In welfare economics, there is a long tradition of considering social welfare as having
(at least) two dimensions those of _________ and _____.
Economic efficiency, distributional justice

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Commodities, such as national defense, which have the characteristic of being both nonviral in consumption and nonexclusive in provision are called ________?
Public goods
Commodities which are consumed without rivalry up until some threshold at which rivalry in consumption begins are called?
Congestible goods
An external diseconomy is defined as:
A negatively valued impact of someone else’s consumption (individual or firm) over which an affected individual (or affected firm) has no choice.
An external economy is defined as:
A positive valued impact of someone else’s consumption (individual or firm) over which an affected individual (or affected firm) has no choice.
A Pareto-relevant externality is defined as:
An externality (economy or diseconomy) for which, given the existing set of property rights, an alteration in its level of esistence would result in gains from trade.
A Pareto-irrelevant externality is defined as:
An externality (economy or diseconomy) for which, given the existing set of property rights, no alteration in its level of esistence would result in gains from trade.
J.R. Commons said ____ are the “going concerns” of an economy.
Institutions
A nonattentuated set of property rights has four major characteristics. They are:
Clearly specified, Exclusive, Transferable, Enforced
The cost of information, contracting, and policing are known as _____________.
Transaction costs
A natural resource which exists in fixed quantity and which is depleted as used is called ______.
An exhaustible resource
A natural resource which is subject to management and can regenerate itself within certain bounds is termed a _____.

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Renewable or biological resource
A natural resource which is available for use in specific quantities per unit of time and which, if not used, is unavailable for use is called a _______.
Flow resource
A resource which comes into the system in specific quantities per unit of time and which has been stored for future use is called a _________.
Fund Resource
The economic effect wherein an enterprise is affected by the actions of another enterprise is :
An externality
The economic value most often used to evaluate the feasibility of new public projects is:
Benefit cost ratio
When goods or services in the economy cannot be valued by the market place, economists estimate their value using:
Non-market valuation techniques
An exchange in the economy in which one individual is made better off and other individuals are made no worse off is called a:
Pareto-optimal exchange
A rate of interest used to equate an income to be received on the future with an equivalent income at present is:
Discount rate
A 1969 federal law that requires an environmental impact assessment of nay large federal project is the :
National Environmental Protection Act (NEPA)
In resource economics, a condition in which all resources, private and public, are allocated so as to maximize consumer welfare is:
An efficient allocation or a pareto-efficient condition
Any resource that, within any reasonable time frame of human existence, cannot be replaced is called:

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An exhaustible resource
Whereas private firms may use a private discount rate to evaluate the feasibility of a project, public projects are evaluated using a:
Social Discount Rate
The competitive adjustments process implies that the price of an exhaustible resource will increase over time at a rate equal to?
The interest rate
What type of resource is not controlled by one user or source?
Common Property Resource
Name three effects of inefficient allocation of resources.
Externalities, improperly defined property rights, imperfect market for trading property rights, and divergence of social and private discount rate.
What is positive economics?
The actions of people and their effect on the government.
What is the preservation or extension of the productive life of a resource?
Conservation
What is any good or service that can be used to produce a good capable of satisfying a human want?
A resource
What is the total quantity of a resource provided by nature?
The physical supply
What is the most prevalent form of erosion in agricultural land?
Sheet and rill erosion by water
__________ ___________ lies under eight Great Plains states and supplies water for approximately 14.3 million acres and is tapped by more than 150,000 irrigation wells.
Ogallala Aquifer
This involves public action to compensate farmland owners for benefits of development separate and distinct from the farm value of land.

Purchase of development rights.
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These protect farmers against legal actions taken against accepted agricultural practice.
Right-to-farm laws
 Why would society not want absolute “perfect” property rights?
Because of the costs associated with them
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What is intertempored resource allocation?
Allocating resource over time, and deciding at what rate to use them.
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Decisions that cause future generations to remain at least as well off as current generations have a _________ criterion.
Sustainable
 ___________ ___________ refer to the bundle of entitlements which define owner’s rights, privileges, and limitations of resource use.
Property rights
* What does EMA stand for?
Environmental Management Accounting
* What federal agency helps conserve, maintain and improve our natural resources and environment?
Natural Resource Conservation Service
*Name 3 Conservation programs in the 2002 Farm Bill?
Conservation of Private Grazing Land Program, Conservation Security Program,
Resource
Conservation and Development Program, Wetlands Reserve Program, Wildlife
Habitat Incentives Program, National Natural Resources Conservation
Foundation, Farmland Protection Program, or Environmental Quality Incentives
Program
* When should a market failure be corrected? only when benefits>cost
* Pollution is an example of _______.
Externality
* Public goods deal with the _____ ____ problem.
Free Rider

* What is an interest in land owned by another that entitles its holder to a specific limited use or enjoyment?
Easement
*Who are actors that take more than their fair share of the benefits or do not shoulder their fair share of the costs of their use of a resource, involvement in a project, etc.?
Free riders
* What are qualities of a non-rivalrous good?
Its benefits do not exhibit scarcity from an individual point of view
Once it has been produced, each person can benefit from it without diminishing anyone else's enjoyment.
Ex. Public Good
* For property rights, the characteristic of exclusivity refers to what?
All benefits and costs accrue only to the owner.
* The basic idea of a Pigouvian tax is what?
To tax the externality such that marginal cost of private and social are the same.
* Which USDA Agency is responsible for providing technical assistance to farmers on preventing soil erosion?
National Resource Conservation Service (NRCS)
* What is the Environmental Quality Incentive Program (EQIP) designed to do?
Combat the market failure created by externalities associated with farming by providing payments to farmers for investments in or strategies geared at reducing water pollution.
* Generally speaking, how do cross-compliance programs work to internalize the cost of externalities?
They deny program benefits such as direct payments to farmers if they do not meet the conservation practices that are set forth.
* What are the characteristics of property rights?
Universality, exclusivity, transferability, enforceability
* What is the term that describes when one uses market data to find value?
Hedonic pricing
*What does the Coase Theorem state?
No matter who gets the rights, society will reach efficiency as long as rights are assigned & transaction costs are low (you want the rights, however, because it impacts wealth)
* _____________ are used as signals of relative scarcity.
Prices
* What occurs when inflation induces variability in relative prices?
Inefficient Resource Allocation

*What are the three types of agents in the macro economy that demand resources?
Households, firms, and government
* Which idea states that it does not matter who gets the rights, society will get to the efficient point as long as rights are assigned an transaction cost are low?
Coase Theorem
* _____________ are a bundle of rights that define what you can and cannot do with a resource.
Property Rights
* The acronym TCEQ stands for which government agency?
Texas Commission on Environmental Quality
* The concept of limited amounts of resources that must then be allocated properly across uses is called?
Resource Scarcity.
* Causing a private entity to pay a tax for their actions that brings the Marginal Cost curve for the private entity equal to the Marginal Cost curve of society is called?
Internalizing an externality.
* What type of good is owned by a section of society that can then exclude other from using it?
Common Use Good
* Name 3 types of farm programs that impact farmland values
Direct payments, price supports, conservation programs
* What constitutional amendment gives the government the right of eminent domain?
The Fifth Amendment
* When is it legal to pollute more than specified by the government?
When you buy pollution allocations given to another company by the government
* The sun is considered what type of resource?
PERPETUAL
* What is NOx or Nitrous Oxide?
URBAN SMOG
* How does deforestation damage air quality?
THROUGH THE RELEASE OF CARBON DIOXIDE INTO THE ATMOSPHERE
* What damages more forests per year than forest fires?
BARK BEETLES
* What occurs when market system does not achieve economic efficiency?
Market Failure
* What is hedonic pricing?
Using market data to get value of a property

* What resources are not exclusively controlled by a single economic agent?
Common property
* Air is an example of ___________ Property.
Open Access
* Which type of property cheapest to enforce?
Common property
* By using pigouvian taxes, what happens to the MC(social) and MC(private)?
MC of private and social are the same
* A public good problem that results when someone benefits without contributing:
Free rider
* Theory applied to resources such as groundwater that allows landowners to pump as much as desired from their stocks
Right of capture (could accept first-come, first-serve)
* Two of the four characteristics of private property rights
Universality, exclusivity, transferability, enforceability