Suppose that four land owners,A,B,C,and D,own adjacent lots.Recently,a pool of oil was discovered that is under all four lots but does not extend beyond the four lots.Below is information on the relationship between number of oil wells,output per well and revenue per well.
-Refer to the information above.The effect on society of having this pool of oil owned by four different people is
A) to be worse off because the size of the pool is reduced.
B) to be better off with more oil.
C) to be better off because a single owner is a monopoly.
D) zero.
E) indeterminate.

Question

Suppose that four land owners,A,B,C,and D,own adjacent lots.Recently,a pool of oil was discovered that is under all four lots but does not extend beyond the four lots.Below is information on the relationship between number of oil wells,output per well and revenue per well. 
-Refer to the information above.The effect on society of having this pool of oil owned by four different people is
A) to be worse off because the size of the pool is reduced. 
B) to be better off with more oil. 
C) to be better off because a single owner is a monopoly. 
D) zero. 
E) indeterminate.

Quizplus · Accepted Answer

When a resource like an oil pool is owned by multiple parties, it can lead to over-extraction and depletion due to lack of coordination, making society worse off.

Suppose That Four Land Owners,A,B,C,and D,own Adjacent Lots