The quantity of a public good produced by private provision
A)is less than the efficient quantity.
B)is equal to the efficient quantity.
C)is greater than the efficient quantity.
D)maximizes total public benefit.
E)maximizes net public benefit.

Question

Quizplus · Accepted Answer

Private provision of public goods results in underproduction due to the free-rider problem, which leads to a market failure. Therefore, the quantity produced through private provision is less than the efficient quantity.

The Quantity of a Public Good Produced by Private Provision