1. Foundations

Concepts — Quiz

Test your understanding of concepts with 5 practice questions.

Practice Questions

Question 1

Which statement best distinguishes resilience from sustainability in environmental policy and management?

Question 2

Given two ecosystems with recovery times $T_A=2$ years and $T_B=5$ years, resilience is defined as $R=1/T$. What is the ratio $R_A/R_B$?

Question 3

If a firm’s private marginal cost of pollution is \20 per unit and the marginal social cost is \$50 per unit, what Pigovian tax should be imposed to internalize the externality?

Question 4

A solar farm yields a marginal private benefit of \40/MWh and a marginal social benefit of \100/MWh. What per-unit Pigovian subsidy should the government provide?

Question 5

Which sustainability principle holds that certain natural capitals are non-substitutable and must be maintained intact?