It is argued that the market will
A)not produce a nonexcludable public good.
B)produce the socially optimal output of a nonexcludable public good.
C)produce too much of a nonexcludable public good.
D)produce a nonexcludable public good if marginal social benefits are equal to marginal private benefits.

Question

Quizplus · Accepted Answer

The market typically fails to produce nonexcludable public goods because individuals cannot be excluded from using them, leading to the free-rider problem where people benefit without paying, thus reducing the incentive for private firms to produce these goods.

It Is Argued That the Market Will