The tragedy of the commons occurs when: a. There are deadweight losses due to a population externality. b. Goods are undersupplied because of the free rider problem. c. Choices are individually rational but correctively inefficient. d. Externalities occurs because property rights are not clearly assigned.

The market for perfume is characterized by:  MPB=200-Q and MPC= 3Q with a marginal social benefit of -$12 caused by the others smelling the perfume.  The externality is ______ and on the _____ side of the market.  The inefficient quantity is ______ and the price is _____.  The allocatively efficient quantity in the market is ______.  If the government were to correct the externality, it would _______ the market by $______ per unit of perfume. Word Bank: negative, demand, 50, 150, 47, tax, 12, positive, supply, subsidy

-0. Which of the following are examples of activities that yield external benefits? a. Your neighbor paints his house bright orange, pink, purple, black, red, and green. b. The person next to you in class is sick with the flu and keeps coughing toward you. c. Your neighbor blasts his stereo super loud from 3:00 a.m. to 5:00 am while he gets ready for work. d. All of the above are examples of activities that yield external benefits. e.. None of the above are examples of activities that yield external benefits. 1. Which of the following are examples of activities that yield external costs? a. Your neighbor paints his house bright orange, pink, purple, black, red, and green. b. The person next to you in class is sick with the flu and keeps coughing toward you. c. Your neighbor blasts his stereo super loud from 3:00 a.m. to 5:00 am while he gets ready for work. All of the above are examples of activities that yield external costs. d. e. None of the above are examples of activities that…

The tragedy of the commons: Select one: a. applies to the destruction of rival, excludable goods. b. applies to the destruction of nonrival, nonexcludable goods. c. explains the tendency to underconsume common resources. d. explains the tendency to overconsume common resources. e. applies to rival and nonexcludable goods. f. Answers D and E are correct.