Suppose your city has had an increase in crime and the city government decides that more police are needed to patrol at night. Which of the following funding solutions avoids the free-rider problem involved with additional police officers?
A) taxation of the city's top 50% of income earners
B) donation-based police service
C) voluntary police officers
D) an increase in the city's sales tax

Question

Quizplus · Accepted Answer

An increase in the city's sales tax would ensure that everyone who benefits from the additional police officers contributes to the funding, avoiding the free-rider problem. Taxation of the city's top 50% of income earners could still result in some individuals benefiting from the police presence without contributing their fair share. Donation-based police service and voluntary police officers would likely not provide enough funding to significantly increase the number of officers on patrol.

Suppose Your City Has Had an Increase in Crime and the City