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A common (open access) good is characterized by: Rival in consumption and excludable Rival in consumption...

  1. A common (open access) good is characterized by:

    1. Rival in consumption and excludable

    2. Rival in consumption and non-excludable

    3. Non-rival in consumption and excludable

    4. Non-rival in consumption and non-excludable


  1. A negative externality produces:

    1. Additional benefits

    2. Additional costs

    3. Additional quotas

    4. Additional marginal revenue

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Answer #1

Answer: Rival in consumption and non-excludable.

The example of these goods are fishes in the lakes, fruits on common trees, etc. These goods are rival in consumption because if anyone consumes this, this loses an opportunity for the others to consume this. For example, there are a limited amount of fishes in the lake and if a fisherman catches it. It loses an opportunity for the other fisherman. This is non-excludable because it provides access for everyone irrespective of the payments.

Answer: Additional costs

Negative externality causes destruction or negative reactions to someone who is not using the product. For example, driving a car causes pollution and the public suffers of the pollution. So, this is the negative externality of using car.

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