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Why Do Private Markets Tend to Undersupply Nonrivalrous Goods

Question 56

Multiple Choice

Why do private markets tend to undersupply nonrivalrous goods?


A) Because free riders will refuse to pay for these goods.
B) Because the tragedy of the commons will reduce their value to zero.
C) Because people have an incentive to understate their preferences for these goods.
D) Because the efficient price for these goods is zero.

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