The similarity between markets for common resources and markets with externalities is that:
A)the price that competitive firms charge does not capture the true costs and benefits of consumption.
B)the equilibrium quantity is too high in terms of society.
C)government involvement is needed to reach an efficient outcome.
D)All of these statements are true.

Question

Quizplus · Accepted Answer

The Answer of The similarity between markets for common resources and markets with externalities is that:
A)the price that competitive firms charge does not capture the true costs and benefits of consumption.
B)the equilibrium quantity is too high in terms of society.
C)government involvement is needed to reach an efficient outcome.
D)All of these statements are true.

The Similarity Between Markets for Common Resources and Markets with Externalities