Chapter 76, Problem 6MCQ

To determine

The common resource

Answer to Problem 6MCQ

From the available options, the correct option is nonexcludable and rival in consumption.

Explanation of Solution

A common resource is nonexcludable and rival in consumption because it indicates that when resources or goods are used or consumed then it reduces the amount of those resources for the consumption of other people such as scarcity of natural resources. And, these resources not always consider as a public good which is a non-rival. Therefore, common resources would not be non-rival and excludable.

Here, the correct option is d (non-excludable and rival in consumption).

Economics Concept Introduction

Introduction: Excludable refers to the situation when according to people's willingness to pay, producers can prevent certain people from using or consuming goods and services. And, a rival in consumption means if one person consumes a good or service then it reduces the number of available goods and services for consumption by another.

A public good covers both non-excludable as well as non-rival. And, a private good is excludable and rival in consumption which may prevent people from consuming when one person consumes the same good.

Common resources are the natural scarce resources or goods which are also not always non-rival in consumption.