The "tragedy of the commons" refers to
a) farmers who allow their livestock to overgraze their fields
b) the acceptance of deplorable working conditions by those who lack the human capital to obtain a better job
c) the absence of incentives to prevent the overuse and depletion of a commonly used resource
d) the tendency for bureaucrats to maximize their budget
Answer: c) the absence of incentives to prevent the overuse and depletion of a commonly used resource
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An oligopolist cannot use the MR = MC rule to find its equilibrium output level because
a. oligopolists do not face stable demand curves for their output b. oligopolists do not try to maximize profits in the long run c. it is too difficult to estimate marginal cost d. the rule applies only in perfect competition e. the minimum efficient scale exceeds total quantity demanded
Based on the figure below. Starting from long-run equilibrium at point C, an increase in government spending that increases aggregate demand from AD to AD1 will lead to a short-run equilibrium at point ________ creating _____gap. 
A. D; an expansionary B. B; no output C. B; expansionary D. A; a recessionary