Private decisions about consumption of common resources and production of public goods usually lead to an
A)efficient allocation of resources and external effects.
B)efficient allocation of resources and no external effects.
C)inefficient allocation of resources and external effects.
D)inefficient allocation of resources and no external effects.

Question

Quizplus · Accepted Answer

Private decisions often lead to an inefficient allocation of resources and external effects because individuals do not account for the broader impact of their actions on society, leading to overuse of common resources and underproduction of public goods.

Private Decisions About Consumption of Common Resources and Production of Public