If good x is available free of charge, then
A)good x must be provided by nature.
B)good x must be provided by the government.
C)the private market cannot ensure an efficient allocation of resources in the market for good x.
D)government policy is incapable of increasing total surplus in the market for good x.

Question

Quizplus · Accepted Answer

When a good is free, the private market may not allocate resources efficiently because there is no price mechanism to signal scarcity or value, leading to potential overuse or misallocation.

If Good X Is Available Free of Charge, Then