Multiple Choice
The rationing of tires shown in the photograph is most likely to be caused by which of the following?
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7. Externalities
Externalities: Social Benefits and Social Costs
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Join thousands of students who trust us to help them ace their exams!Watch the first videoMultiple Choice
All of the following are types of resource constraints except:
A
Land constraints
B
Capital constraints
C
Labor constraints
D
Social cost constraints
Verified step by step guidance1
Understand what resource constraints mean in microeconomics: they refer to the limitations on the availability of inputs used in production, such as land, labor, and capital.
Identify the common types of resource constraints: these typically include land constraints (limited natural resources), labor constraints (limited workforce), and capital constraints (limited machinery, tools, or financial resources).
Recognize that 'social cost constraints' do not fit the category of resource constraints because social costs refer to external costs borne by society, not limitations on productive resources.
Compare each option to the definition of resource constraints to determine which one does not belong to the group.
Conclude that 'social cost constraints' is the correct answer as it is not a type of resource constraint.
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