1. What is meant by non-rivalry?
- Consumption by any one person does not affect consumption of any others
- People can benefit directly from the consumption of a public good but do not contribute towards its provision
- Individuals cannot be excluded from their consumption. They are provided for all, irrespective of whether they have paid for the product indirectly through taxation.
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Other questions in this quiz
2. Merit goods tend to have ________ externalities associated with their consumption
3. If only the private costs/benefits were reflected in the price of the product then it would not accurately reflect the true cost, therefore it will lead to either over or under production.
4. Merit goods and demerit goods are both examples of ?
- Information failure
- Market failure
5. What are negative externalities?
- Negative externalities occur when the social costs are greater than the private costs.
- Negative externalities occur when the private costs are greater than the social costs .
- Negative externalities occur when the first parties do not benefit from third party actions.