For which type of good is it necessary to sum the marginal benefit curves vertically in order to obtain the economy's marginal benefit curve?
A) public goods
B) mixed goods
C) private goods
D) goods that are subject to the exclusion principle
E) common resources

Question

Quizplus · Accepted Answer

Vertical summation is necessary for public goods because they have non-excludable and non-rivalry features that make individual marginal benefits and demands impossible to observe or measure. Therefore, the economy's marginal benefit can only be obtained by adding up the individual marginal benefits vertically.

For Which Type of Good Is It Necessary to Sum