The Tragedy of the Commons Will Be Evident When a Growing

question 127

Multiple Choice

The Tragedy of the Commons will be evident when a growing number of hikers using the trails which leads to destruction of the ecosystem.How can this problem be corrected

• A)The government could allow individual hikers to take responsibility for maintaining the trails.
• B)The externality could be internalized by subsidizing back country camp sites.
• C)The government could auction off a limited number of hiking permits.
• D)The government could provide more hiking trails.

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Definitions:

Perfect Competitor

A theoretical market structure where many firms sell identical products, entry and exit are free, and no single buyer or seller can influence the market price.

Long Run

A period in which all factors of production and costs are variable, allowing firms to adjust all inputs.

Patents

Legal documents that grant an inventor exclusive rights to manufacture, use, or sell an invention for a certain number of years.

Monopoly Power

The control held by a single entity over the entire market for a product or service, allowing it to significantly influence or set prices.