When one person uses a common resource, she diminishes other people's enjoyment of it.This is an example of:
A)a market force
B)a negative externality
C)the 'invisible hand
D)excludability

Question

Quizplus · Accepted Answer

This scenario describes a negative externality, which is a cost imposed on a third party that is not taken into account in the market transaction. In this case, the person using the common resource diminishes the enjoyment of others without paying for that cost. This is an example of a negative externality.

When One Person Uses a Common Resource, She Diminishes Other