Practice Questions
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What is a common consequence of the tragedy of the commons in relation to public goods?
When many people share a resource, they might use too much of it. Other options are incorrect because Some might think that sharing leads to better te...
Which of the following best illustrates a market failure due to the free rider problem in the context of public goods?
A lighthouse helps all ships, even those that don't pay. Other options are incorrect because This option is about a private company; A bakery selling ...
Which of the following scenarios exemplifies both non-rivalry and a potential tragedy of the commons in the context of public goods?
A public park can be used by many people at the same time, showing non-rivalry. Other options are incorrect because A private swimming pool is only fo...
In the context of public goods, how does the free rider problem complicate cost-benefit analysis when evaluating whether to provide a public good?
The free rider problem means some people benefit without paying. Other options are incorrect because Some might think that free riders help show how m...
Which of the following scenarios best illustrates the concept of the free rider problem as it relates to public goods and market failure?
A person using a public park without helping to keep it nice shows the free rider problem. Other options are incorrect because Buying seeds for crops ...
What is a key characteristic of public goods that leads to the free rider problem?
Public goods are non-excludable and non-rivalrous. Other options are incorrect because Some think public goods must be provided by the government; It'...
Which of the following is a characteristic of public goods that leads to the free rider problem?
Public goods are non-excludable, meaning everyone can use them. Other options are incorrect because Some might think high production costs cause the f...
What is a defining characteristic of public goods that leads to the free rider problem?
Public goods are non-excludable, which means people cannot be easily stopped from using them. Other options are incorrect because Some might think pub...
A community decides to build a public park that will benefit everyone. However, some residents choose not to contribute to the funding, expecting others to cover the costs. What economic principle does this scenario illustrate, and what might be the consequence of this behavior?
This situation shows the free rider problem. Other options are incorrect because This answer suggests that public goods are made too much; This option...
Arrange the following steps in the process of addressing the free rider problem related to public goods:
First, we need to know what the public good is and how it helps everyone. Other options are incorrect because Thinking about the free rider problem to...
How does the free rider problem impact the provision of public goods in a market economy?
The free rider problem means some people benefit from public goods without paying for them. Other options are incorrect because Some might think that ...
The _____ problem arises when individuals benefit from a public good without contributing to its cost, leading to inefficient allocation and potential underproduction of the good.
The free rider problem happens when people use a service without paying for it. Other options are incorrect because This idea is about shared resource...
Which of the following statements accurately describe the characteristics of public goods and the implications of the free rider problem? Select all that apply.
Other options are incorrect because This suggests only the government can provide public goods; This implies that free markets can't produce enough pu...
How does the free rider problem affect the provision of public goods in a market economy?
The free rider problem means that some people benefit from public goods without paying for them. Other options are incorrect because Some might think ...
Public goods are to government provision as free riders are to which of the following?
Free riders benefit from public goods without paying for them. Other options are incorrect because Some might think resource allocation is about how g...
Which of the following scenarios best illustrates the concept of a public good and the associated free rider problem?
A lighthouse helps all ships find their way without charging them. Other options are incorrect because A restaurant requires payment for meals; A priv...
If a public good is underproduced due to the free rider problem, what is the underlying cause of this inefficiency?
People don't pay for public goods because they can use them for free. Other options are incorrect because Some might think the price is too high; It's...
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