Like Negative Externalities,tradable Permits Are Useful in Allocating Common Resources

question 48

Multiple Choice

Like negative externalities,tradable permits are useful in allocating common resources because:

• A) the depletion of common resources imposes a negative externality.
• B) the problem present in both is overconsumption.
• C) the socially optimal quantity is not the same as the individual consumers in either case.
• D) All of these statements are true.

---

Definitions:

Jamaica

An island country situated in the Caribbean Sea, known for its rich culture, music, and scenic beauty.

Trade Policy

A government's strategy regarding international trade, affecting how goods and services move across borders through tariffs, trade agreements, and regulations.

U.S. Market

The economic arena constituted by the exchange of goods and services within the United States, characterized by its diversified industries and consumer base.

Economic Efficiency

A situation where resources are allocated in a way that maximizes the net benefit to society, and it is impossible to make one individual better off without making someone else worse off.