What causes the overexploitation and depletion of common pool resources?
What will be an ideal response?
Common pool resources are overexploited because these resources are non-excludable in consumption. However, these goods are rival in consumption. Therefore, the overexploitation of these resources leads to their depletion.
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The structural deficit is
A) the difference between the actual deficit and the natural employment deficit and it increases whenever income rises. B) identical to the natural employment deficit and it decreases whenever tax rates are cut. C) identical to the natural employment deficit and it increases whenever the natural level of output increases. D) identical to the natural employment deficit and it decreases whenever the natural level of output increases.
Externalities arise when: a. the benefits of a transaction between producers and consumers are enjoyed by only the consumers. b. the benefits of a transaction between producers and consumers are enjoyed by only the producers. c. a transaction negatively impacts people who are not directly involved in the transaction
d. a transaction occurs without the government's approval.
If a resource is in fact becoming scarcer, then one should expect
A. the price of the resource to rise. B. less demand for the resource as people try to conserve. C. greater supply as people reduce inventories before it is all gone. D. the quantity supplied to increase.
If the marginal product per dollar spent on capital is less than the marginal product per dollar spent on labor, then in order to minimize costs the firm should use:
A. more labor and more capital. B. less labor and less capital. C. less labor and more capital. D. less capital and more labor.