A free rider problem arises when
a. there are very few beneficiaries and exclusion of any one of them is possible.
b. there are many beneficiaries and exclusion of any one of them is possible.
c. there are many beneficiaries and exclusion of any one of them is impossible.
d. there are very few beneficiaries and they all try to use the good simultaneously.
c
You might also like to view...
"My son is a smart entrepreneur. Rather than borrow money from others, he used his own savings to start his music business, and thereby avoided paying interest on loans." An economist would respond by saying
A) "both you and your son are complete idiots." B) "it's always good to avoid borrowing and paying interest." C) "nobody can avoid paying interest, not even your clever son." D) "your son might have avoided paying interest, but he also avoided earning interest."
Convexity of indifference curves implies that consumers are willing to
A) give up more "y" to get an extra "x" the more "x" they have. B) give up more "y" to get an extra "x" the less "x" they have. C) settle for less of both "x" and "y". D) acquire more "x" only if they do not have to give up any "y".