A free-rider problem arises whenever:
a. goods cannot be provided exclusively to those who pay for them.
b. the price of a good is very low
c. the government provides goods or services.
d. goods cease to be scarce.
a
Economics
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A private subsidy has what effect on the amount of a good or service produced? Is a private subsidy an appropriate policy to offset the inefficiency from an external cost or an external benefit?
What will be an ideal response?
Economics
Refer to Table 13-1. What portion of the marginal revenue of the 4th unit is due to the output effect and what portion is due to the price effect?
A) output effect = -$0.50; price effect = $5.00 B) output effect = $24.00; price effect = $19.50 C) output effect = $6.00; price effect = -$1.50 D) output effect = $6.50; price effect = $2.00
Economics