The combination of inefficiently high demand and dwindling quantity leads to what is called:
A. the free rider problem.
B. nonexcludable consumption.
C. rival in consumption.
D. the tragedy of the commons.
D. the tragedy of the commons.
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Economic rent is paid only to land, and not to other resources.
Answer the following statement true (T) or false (F)
Economists love auctions because
a. They maximize consumer surplus b. They minimize producer surplus c. They set the price for the item, avoiding costly negotiations d. They open the door to costly negotiations, with room for manipulation
Economists believe that scarcity forces everyone to:
a. satisfy all their wants. b. abandon consumer sovereignty. c. lie about their wants. d. create unlimited resources. e. make choices.
Which of the following is a primary difference between price searchers and price takers?
a. Price searchers maximize profits, but price takers do not. b. Price searchers have to cut their price to sell additional output, but price takers do not. c. The market demand for goods produced by price searchers is downward sloping, while the market demand for goods produced by price takers is horizontal. d. Profit-maximizing price searchers will expand output to the quantity where marginal revenue equals marginal cost, but price takers will not.