In the case of a public good:
A) a consumer could be a free rider.
B) firms get a signal that fully reflects benefits received by consumers.
C) firms will get signals to produce more than is economically efficient.
D) it is quite costly to add consumers.

Question

Quizplus · Accepted Answer

In the case of a public good, it is possible for consumers to be free riders, meaning they benefit from the good without contributing to its provision. This is because the good is non-rival and non-excludable, meaning consumption by one person does not reduce its availability for others and it is difficult to prevent people from using it, making it less profitable for firms to produce.

In the Case of a Public Good