-The above figure shows the marginal private cost curve,marginal social cost curve,and marginal social benefit curve for cod,a common resource.A quota to prevent the overuse of the cod sets the catch equal to ________.
A) 0 tons per week
B) 200 tons per week
C) 400 tons per week
D) 300 tons per week
E) 500 tons per week

Question

-The above figure shows the marginal private cost curve,marginal social cost curve,and marginal social benefit curve for cod,a common resource.A quota to prevent the overuse of the cod sets the catch equal to ________.
A) 0 tons per week 
B) 200 tons per week 
C) 400 tons per week 
D) 300 tons per week 
E) 500 tons per week

Quizplus · Accepted Answer

A quota to prevent overuse of a common resource like cod should be set where the marginal social cost equals the marginal social benefit, which is typically at the socially optimal level of production.

-The Above Figure Shows the Marginal Private Cost Curve,marginal Social