Which of the following is true?
A)Consumption of a public good by one individual reduces the availability of the good for others.
B)It is extremely difficult to limit the benefits of a public good to the people who pay for it.
C)Public goods are free whenever the government produces them.
D)From an efficiency standpoint, a market economy will generally supply too much of a public good.
E)None of the above are correct.

Question

Quizplus · Accepted Answer

Public goods are non-rivalrous and non-excludable in nature, meaning consumption of the good by one individual does not reduce the availability of the good for others and it is difficult to limit the benefits of the good to only those who pay for it. Option A is incorrect because it describes a private good, not a public good. Option C is incorrect because public goods still require resources to produce and are ultimately paid for by taxpayers. Option D is incorrect because market failure often leads to underproduction of public goods, not overproduction.

Which of the Following Is True