Suppose the Alaskan King Crab Harvest Is Unregulated and Any

Multiple Choice

Suppose the Alaskan king crab harvest is unregulated and any person with a crab boat and some diesel fuel can go offshore, lower a crab pot, and harvest king crab.As a result, this common resource is overused.Which of the following policy choices might create an outcome in which the king crab harvest is socially optimal?

A) The state of Alaska subsidizes the purchase of crab boats.
B) The state of Alaska auctions a limited number of licenses to harvest king crab.
C) The state of Alaska removes taxes on diesel fuel, which lowers the price of diesel.
D) The U.S.and Canadian governments remove trade barriers, which allows for more trade of products like king crab.