16. The tragedy of the commons a. is an issue with common property resources. b. occurs primarily when a single person owns all of a key resource. c. is an issue with private goods. d. is a theoretical concept which we never observe in real life.

17. A positive externality occurs when a. there are no additional benefits received by a third party. b. benefits are received by a third party. c. costs are imposed on a third party. d. all benefits received by those buying and selling the good

2. Excludability has to do with a. how popular a good is.

b. how easy it is to prevent people from consuming something.

c. whether one person's consumption reduces the amount available to others.

d. how expensive a good is.

3. Positive externalities tend to cause a. underproduction of the good/service associated with it.

b. firms producing the good/service associated with it to shutdown permanently.

c. overproduction of the good/service associated with it.

d. optimal production of the good/service associated with it.

4. Sources of market failure include all of the following except a. public goods.

b. positive externalities.

c. clearly defined property rights.

d. negative externalities.