A good that can be consumed even if the consumer does not pay for it
A) is necessarily rival in consumption.
B) completely avoids the free rider problem.
C) does not exist because firms won't produce goods for which consumers won't pay.
D) is nonexcludable.
E) might be nonexcludable but is definitely nonrival.

Question

Quizplus · Accepted Answer

A good that can be consumed even if the consumer does not pay for it is known as a nonexcludable good. This creates a free rider problem, where individuals can benefit from the good without paying for it. While the good may still be rivalrous in consumption (meaning one person's use of the good limits another's use), it can still be nonexcludable and subject to free riding. Firms may still produce nonexcludable goods if they receive government subsidies or if there is a demand for the good from consumers who are willing to pay for it.

A Good That Can Be Consumed Even If the Consumer