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6. demerit good
- A good that posses the characteristics of non-excludability and non-rivalry in consumption
- A good that would be over-consumed in a free market, as it brings less overall benefit to consumers than they realise
- A good that would be under-consumed in a free market, as individuals do not fully perceive the benefits obtained from consumption
7. merit good
- A good that would be under-consumed in a free market, as individuals do not fully perceive the benefits obtained from consumption
- where economic agents do not properly perceive the benefits or disadvantages of a transaction
- where the free market provides a product but with misallocation of resources
8. information failiure
- A good that posses the characteristics of non-excludability and non-rivalry in consumption
- where economic agents do not properly perceive the benefits or disadvantages of a transaction
- A good that would be over-consumed in a free market, as it brings less overall benefit to consumers than they realise