Nonexcludability, in the case of rival goods, causes _______ demand.
A)inefficiently high
B)inefficiently low
C)efficiently high
D)efficiently low

Question

Quizplus · Accepted Answer

Nonexcludability means that it is difficult or impossible to prevent people from consuming a good or service, even if they do not pay for it. In the case of rival goods, this means that one person's consumption of the good or service reduces the amount available for others. This can lead to inefficiently high demand, as people consume more of the good or service than they would if they had to pay for it.

Nonexcludability, in the Case of Rival Goods, Causes _______ Demand