1. A prisoner's dilemma illustrates situations in which:

Multiple Choice

A. resources with the lowest opportunity cost should be used first.

B. everyone does best when each person specializes in the activities in which he or she has a comparative advantage.

C. efficiency is an important social goal.

D. there is a conflict between the narrow self-interest of individuals and the broader interests of a group.

2. Suppose that a vaccine is developed for a highly contagious strain of flu. The likelihood that anyone will get this flu decreases as more people receive the vaccine. One of the demand curves below represents the private demand for the vaccine and the other represents the social demand for the vaccine.

\fProcess (smoke/day) A (4 tons/day) B (3 tons/day) C (2 tons/day) D (1 tons/day) E (9 tons/day) to x (as/day) - to v (mm -:_ to z (as/dam m