The local community in a town has arranged for a fireworks show in a park located in the center of town.The cost of the ticket to watch the show is $5.However,only 40 percent of the tickets are sold,as spectators can watch the show without entering the park.This is an example of ________.
A) the free-rider problem
B) the paradox of thrift
C) the paradox of plenty
D) the tragedy of the commons

Question

Quizplus · Accepted Answer

This is an example of the free-rider problem, where individuals can benefit from a public good (fireworks show) without paying their fair share. As a result, only a fraction of the tickets are sold.

The Local Community in a Town Has Arranged for a Fireworks