Which of the Following Examples Specifies the Cause of the Tragedy

question 99

Multiple Choice

Which of the following examples specifies the cause of the tragedy of the common?

• A) People like to eat chicken so demand for chicken has significantly increased.
• B) The supply of chicken is plentiful, causing the profit margin of selling chicken to decrease.
• C) Tuna in the ocean are not privately owned so fishermen have an incentive to overfish.
• D) The supply of tuna is rare, creating high profit margins and incentives for fishermen to underfish tuna.

---

Definitions:

Cash Flow

The overall volume of cash and cash-equivalents that are exchanged in and out of a business entity.

Timing

The selection of an optimal time or period for making an investment, launching a product, or executing a decision to maximize benefits or outcomes.

Capital Budgeting

The process of planning and evaluating investments in long-term assets, analyzing their expected cash flows and their impact on the company's financial future.

Bonds

Financial instruments representing a loan made by an investor to a borrower, typically corporate or governmental, where the issuer owes the holders a debt and is obliged to pay them interest and/or repay the principal at a later date, termed the maturity.