Question

The market tends to underproduce public goods because A) public goods tend to have very few benefits. B) public goods always have external costs (negative externalities). C) joint consumption allows those who do not pay for the good to still benefit from the good. D) the consumption of a public good by one persons prevents its consumption by another person.

Answer 1

Answer:

Joint consumption allows those who do not pay for the good to still benefit from the  good.

Explanation:

Public goods are non-excludable and non-rival. Individuals cannot be effectively excluded from using them, and use by one individual does not reduce the good’s availability to others. Examples of public goods include the air we breathe, public parks, and street lights.

Answer 2

It is c. joint consumption allows those who do not pay for the good to still benefit from the good.