Because of the Free-Rider Problem

question 39

Multiple Choice

Because of the free-rider problem,

• A) competitive markets will tend to undersupply public goods.
• B) the federal government spends too much on national defense.
• C) fireworks displays have become increasingly dangerous.
• D) poverty has increased.

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Definitions:

Trust Fund

A legal entity set up to hold assets such as cash, property, or investments for the benefit of a specific person, group, or organization.

Shares Of Apple

Equity shares that represent ownership in Apple Inc., allowing shareholders to claim on the company’s assets and earnings.

Journal Entry

A record in accounting that notes every transaction with debits and credits in the financial books.