Which of the following is true?
i.A common resource is a resource that is nonrival and nonexcludable.
ii.Issuing individual transferable quotas (ITQ)means that for users of common resources,the marginal cost plus the price of the ITQ equals the marginal social cost.
iii.In an unregulated market,a common resource is used to the point at which marginal private benefit equals marginal cost.
A) only i
B) only ii
C) only iii
D) i and ii
E) ii and iii

Question

Quizplus · Accepted Answer

Option i is true because a common resource is a resource that is nonrival and nonexcludable, meaning that it can be used by anyone and its use does not reduce its availability to others. 
Option ii is also true because ITQs are designed to achieve efficiency by equating the marginal cost (MC) plus the price of the ITQ to the marginal social cost (MSC). 
Option iii is true for an unregulated market because, in such a situation, individuals are only concerned with their private benefits, and they will continue to use the common resource to the point where the marginal private benefit equals the marginal cost. This level of use results in overuse and depletion of the common resource.

Which of the Following Is True