Multiple Choice
When a production quota is used to remedy the tragedy of the commons,then
A) the production quota is set so that use of the resource occurs where marginal private benefit equals marginal cost.
B) the production quota is set so that use of the resource occurs where marginal private benefit equals marginal social benefit.
C) the outcome is always efficient.
D) all users of the resource have an incentive to cheat on the production quota.
E) the production quota is set so that marginal social benefit is maximized.
Correct Answer:
Verified
Correct Answer:
Verified
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