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xxMikexx [17]
3 years ago
14

Because public goods are:

Business
1 answer:
nadezda [96]3 years ago
6 0

Answer:

The correct answer is

not excludable, people have an incentive to be free riders. (b.)

Explanation:

Excludability of a good or service is a property of the good or service that makes it impossible for a consumer who has not paid for it to have access to it, hence, a non-excludable good or service is one to which it is impossible to prevent access by people who have not paid for it.

Based on whether goods are excludable or non-excludable, goods can be divided into four categories; private goods, common-pool goods, club goods and public goods.

Public goods: public goods are also called collective goods or social goods. Example here are public parks, street lights, air, etc. In addition to being non-excludable, public goods are also non-rivalrious, meaning that the use of the good by one person does not limit the use by another, hence  the free rider incentive applies.

For a better understanding, I suggest you look up the other types of goods I mentioned above.

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