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The Market Tends to Underproduce Public Goods Because

Question 24

Multiple Choice

The market tends to underproduce public goods because


A) The consumption of a public good by one person prevents the consumption of the same good by another person.
B) The free-rider dilemma results in exclusive consumption of a good.
C) It is difficult to measure the benefit of a public good such as national defense.
D) Joint consumption allows those who do not pay for the good to still benefit from the gooD.Because the familiar link between paying and consuming is broken,public goods cannot be peddled in the supermarket.People are reluctant to buy what they can get for free.

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