Negative Externalities and the Tragedy of the Commons Are Problems

question 37

Multiple Choice

Negative externalities and the tragedy of the commons are problems that have a common source.What is this common source?

• A)self-interest motives of producers and consumers
• B)a lack of concern for human rights
• C)a lack of competition
• D)a lack of clearly defined and enforced property rights

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Definitions:

Common Resources

Goods that are non-excludable and rivalrous, meaning they are available to all but can be depleted by overuse.

Marginal Social Cost

This refers to the entire cost society bears for the production of an additional unit of a good, including both private costs borne by producers and external costs absorbed by others.

Common Resource

A resource like air or water that is non-excludable and rivalrous, meaning it's difficult to prevent anyone from using it, and one person's use diminishes others' use.

Common Resource

A resource like air or water that is not owned by anyone, but can be used freely by the public, often leading to overuse and depletion.