The Hotelling Principle States That

Multiple Choice

The Hotelling Principle states that

A) hotels tend to be built next to major highways.
B) equilibrium in natural resource markets occurs when the expected increase in the price of the resource over time is equal to the interest rate.
C) the resource will be depleted at a rate equal to the rate of interest.
D) natural resources should be depleted only for the production of goods that would help maintain environmental quality.
E) we should conserve nonrenewable natural resources.