A public good is one for which:
A) consumers who don't pay for the good can be excluded from its use.
B) the marginal cost of adding another consumer is zero.
C) the good is divisible and measurable.
D) there are no external costs.

Question

Quizplus · Accepted Answer

A public good is characterized by non-excludability and non-rivalry. This means that it is difficult to exclude individuals from using the good and that its use by one person does not reduce its availability to others. Option A is incorrect because consumers who don't pay for the good cannot be excluded from its use. Option C is incorrect because a public good need not be divisible or measurable. Option D is incorrect because external costs or benefits are not the defining characteristic of a public good. Option B is correct because the marginal cost of adding another consumer is zero, meaning that there is no additional cost incurred in providing the good to an additional person.

A Public Good Is One for Which