The principal feature of private goods is that
A) they cannot be rented or purchased.
B) consumption by one person reduces the quantity available to others.
C) no one can be excluded from consumption of the product.
D) externality problems associated with their production are always negative.

Question

Quizplus · Accepted Answer

Private goods are items that are both excludable and rivalrous. Excludability implies that it is possible to prevent non-paying individuals from using the product, while rivalry implies consumption by one person reduces the quantity available to others. Therefore, option B is the correct choice.

The Principal Feature of Private Goods Is That