If the use of a common resource is determined by the free market, the resource:

Question 26 options:

	will be overused, since the marginal benefit will be equated to the marginal private cost of production, which is less than the marginal social cost.
	will be overused, since the marginal benefit will be equated to the marginal private cost of production, which is greater than the marginal social cost.
	will be underused, since the marginal benefit will be equated to the marginal private cost of production, which is greater than the marginal social cost.
	may not be efficiently allocated, but society will be better off than if the government intervened and tried to improve the situation, since government intervention always makes a bad situation worse.

A monopoly is a market structure characterized by:

options:

	barriers to entry.
	a single buyer and several sellers.
	a large number of small firms.
	a product with many close substitutes.

The characteristics of which of the following goods is best described as "artificially scarce"?

options:

	Diamond rings
	Fish in open water
	National defense
	Sports broadcasts on ESPN

Number of Room Cleanings per month	Aisha's Total Benefit	Sara's Total Benefit
0	$0	$0
1	$10	$8
2	$18	$15
3	$24	$21
4	$28	$26
5	$30	$30

Aisha and Sara are roommates who both benefit from having their room cleaned by a cleaning service. The table shows the relationship between the number of times the room is cleaned per month and the total benefit they get. The marginal cost of each room cleaning is $16.

What is the efficient number of room cleanings per week that maximizes total surplus?

options:

	3
	1
	2
	0