To achieve the efficient amount of use of a common resource,the use should be such that ________ equals ________.
A) marginal social cost; marginal private cost
B) marginal social cost; marginal social benefit
C) marginal private benefit; marginal cost
D) marginal cost; marginal benefit
E) marginal social benefit; marginal private cost

Question

Quizplus · Accepted Answer

In order to achieve the efficient amount of use of a common resource, the use should be such that the marginal social cost equals the marginal social benefit. This is because a common resource is a good that is non-excludable and rival in consumption, so the actions of one individual using the resource affects the enjoyment of the resource by others. By equating marginal social cost and marginal social benefit, the optimal use of the common resource will be achieved, where the benefits of using the resource are greater than the costs.

To Achieve the Efficient Amount of Use of a Common