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Suppose a common resource-wood in a public forest-is being overused because residents consider the benefits of gaining firewood or wood for building but do not account for the cost of deforestation when chopping down trees. What could be done to prevent wood in the forest from being overused? To prevent overuse of the common resource, OA. the community could establish social customs prohibiting the use of permits required to chop down trees. B. the government could impose restrictions on access to wood in the forest. OC. the government could subsidize chopping down trees. OD. the community could create transaction costs to private bargaining. E. the government could make a binding commitment to keep the forest lands public.

Suppose a common resource-wood in a public forest-is being overused because residents consider the benefits of gaining firewood or wood for building but do not account for the cost of deforestation when chopping down trees. What could be done to prevent wood in the forest from being overused? To prevent overuse of the common resource, OA. the community could establish social customs prohibiting the use of permits required to chop down trees. B. the government could impose restrictions on access to wood in the forest. OC. the government could subsidize chopping down trees. OD. the community could create transaction costs to private bargaining. E. the government could make a binding commitment to keep the forest lands public.

Practical Management Science
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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Suppose a common resource-wood in a public forest-is being overused because residents consider the benefits of gaining firewood or wood for building but do not account for the cost of deforestation when chopping down trees. What could be done to prevent wood in the forest from being overused? To prevent overuse of the common resource, A. the community could establish social customs prohibiting the use of permits required to chop down trees. B. the government could impose restrictions on access to wood in the forest. C. the government could subsidize chopping down trees. OD. the community could create transaction costs to private bargaining. E. the government could make a binding commitment to keep the forest lands public.
Transcribed Image Text:Suppose a common resource-wood in a public forest-is being overused because residents consider the benefits of gaining firewood or wood for building but do not account for the cost of deforestation when chopping down trees. What could be done to prevent wood in the forest from being overused? To prevent overuse of the common resource, A. the community could establish social customs prohibiting the use of permits required to chop down trees. B. the government could impose restrictions on access to wood in the forest. C. the government could subsidize chopping down trees. OD. the community could create transaction costs to private bargaining. E. the government could make a binding commitment to keep the forest lands public.
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