Why are fish in the ocean an example of a resource that suffers from the tragedy of the commons but cattle grazing in a farmer's pasture do not suffer from the tragedy of the commons?
What will be an ideal response?
Fish in the ocean are a common resource because they are rival, so that one person catching a fish prevents others from catching the same fish, and they are nonexcludable, so that no one can be prevented from fishing. As a result, over-fishing is likely to occur. But cattle grazing in a farmer's pasture are not a common resource. The cattle are rival, so that one person butchering a steer prevents others from butchering the same steer, but the cattle are excludable, so that no one can butcher a steer unless the cattle's owner is compensated. As a result, the owner has the incentive to conserve the resource, that is, the owner has the incentive to insure that the cattle are not overused.
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The table below shows the weekly supply for hamburgers in a market where there are just three sellers.PriceSeller 1 Qs 1Seller 2 Qs 2Seller 3 Qs 3$58544643343222211 If there were 300 sellers in the market, each with a supply schedule identical to seller 1 in the table above, then the weekly quantity of hamburgers supplied in the market at a price of $2 would be
A. 900. B. 1,500. C. 600. D. 200.
List and briefly describe the four major types of transactions costs involved when dealing with a negative externality
What will be an ideal response?
Aggregate expenditure includes consumption spending, planned investment spending, government purchases, and net exports
Indicate whether the statement is true or false
Which of the following is an example of a financial intermediary?
A. Banks. B. The U.S. Treasury. C. The S&P 500. D. The department of finance.