An inefficiency can arise in the provision of public good:
A)Because the good is non-rival.
B)As a private sector firm cannot enforcement payment for the good.
C)Because the marginal benefit curve for society is the vertical summation of individual MB curves.
D)a and C

Question

Quizplus · Accepted Answer

An inefficiency arises because private firms cannot enforce payment for public goods, leading to under-provision due to the free-rider problem.

An Inefficiency Can Arise in the Provision of Public Good