The free-rider problem implies that:
A. each person will pay the full cost of the public good.
B. nobody wants the public good.
C. everybody will pay a portion of the cost of the public good.
D. each person will try to benefit from the public good without paying for it.
Answer: D
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The "law of demand" states that, other thing remaining the same, the higher
A) the price of a good, the lower is the demand for this good. B) consumers' incomes, the greater is the demand. C) the price of a good, the higher is the quantity demanded. D) the price of a good, the smaller is the quantity demanded.
Some individuals seek to use government action to make themselves better off at the expense of others. The actions of these individuals
A) are evidence of the voting paradox. B) are examples of fraud; but these individuals usually avoid prosecution because of logrolling and rational ignorance. C) offer proof that Adam Smith's "invisible hand" is not valid. D) are examples of rent seeking.