Tragedy Of The Commons

Question 1

Define tragedy of the commons

Answer 1

Refers to the effect of an individuals acting in a way where there own self intrest is contrary to what is best for society

Question 2

Why can tragedy of commons not occur for anything considered a public good ?

Answer 2

No one can be depeted from it in a ways no rivalrous

Question 3

What is a merit good ?

Answer 3

Good that are more beneficial for consumers than they realise

In a free market they will be underconsumed

Question 4

What is a demerit good ?

Answer 4

Goods that are more harmful for consumers than they realise

In a free market they will be overconsumed

Question 5

Examples of merit goods

Answer 5

Water and fruit

Question 6

Examples of demerit goods

Answer 6

Fizzy drinks and cigerettes

Question 7

What is a search goods

Answer 7

You can tell it looks good
Eg jewlery

Question 8

Experience goods

Answer 8

You need to use it in order to tell if it’s good
Eg houses
Shoes food