Which of the following is an example of allocative efficiency?

a. Consumers minimize their utility.

b.Consumers minimize production efficiency.

c. Producers maximize their costs of production.

d. In the long run, producers pay the least cost to produce their goods.

Which of these does NOT generate an externality?

a. A manufacturer buys a pollution permit and then emits carbon as a waste product.

b.A manufacturer dumps waste in a nearby river.

c. A smoker has a cigarette in a crowded restaurant.

d. An R&D firm receives a patent on life-saving cancer treatments.

Which of these strategies would NOT solve the tragedy of the commons?

a. Encourage local solutions to the tragedy of the commons.

b.Solve it through communal ownership.

c.Divide the commons and allow private ownership of each share.

d. Government takes ownership of the commons.