Question

Question 58 (1 point) When one person uses a common resource, such as fish in the ocean, what would be the most likely outcome? Other people are not likely to be worse off Other people are likely to be compensated for their loss. He or she neglects to account for external effects. There will still be enough left since one person cannot make a major impact. Question 59 (1 point) A binding price ceiling is imposed on the market for peaches. At the ceiling price, what will be the quantity demanded of peaches? O greater than the quantity supplied equal to the quantity supplied O smaller than the quantity supplied artificially restricted by the price ceiling Question 60 (1 point) Which statement is False, when dead-weight loss (DWL) of taxation is relatively small in a market? The loss in total surplus in relatively small. The loss in consumer surplus is small. Raising tax and tax revenue is more attractive for policy maker. Lower price elasticity of demand could be a reason in having small DWL.

Answer 1

a) "C"

With a common resource in the market th external efects are neglected. the answer is "C".

b) "A"

As this is price ceiling the price will be set below the market price and that will increase the demand and reduce the supply causing a shortage in the market.

c) "D"

Lower price elasicity of demand has nothing to do with this.