Suppose that Martin owns a lighthouse,and Lewis owns a nearby port.Martin's lighthouse benefits only those ships that enter Lewis's port.Which of the following statements is not correct?
A)Martin's lighthouse may be considered a private good.
B)Martin can reduce the free-rider problem by charging Lewis a usage fee.
C)Martin can exclude Lewis's port from benefiting from the lighthouse by simply turning the power off.
D)Martin's lighthouse would be considered a common resource.

Question

Quizplus · Accepted Answer

A common resource is one that is non-excludable and rivalrous. However, Martin's lighthouse can be excluded from benefiting Lewis's port by simply turning off the power, making it excludable. Therefore, the lighthouse cannot be considered a common resource.

Suppose That Martin Owns a Lighthouse,and Lewis Owns a Nearby