1.If residents are permitted unlimited access to the use of the grazing land at a zero price, what is the private marginal cost grazing? Draw the MCp curve.

2.Given your answer to question (1), what level of grazing will occur if there is unrestricted access to the land?

3.Is the outcome from part (2) efficient? Why or why not?

2.What is the efficient level of grazing, and how is this shown in a diagram? Explain.

3.Explain why charging residents a fee per unit of access would improve allocative efficiency. How would this be shown in a diagram?

4.Explain why selling individual parcels of the grazing land to the town's residents is also likely to improve efficiency.