If a Pure Public Good Is Produced in a Competitive

question 37

Multiple Choice

If a pure public good is produced in a competitive market, then:

• A)too much or too little of the good will be produced.
• B)too little of the good will be produced.
• C)the socially optimal amount of the good is produced.
• D)too much of the good will be produced.

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Definitions:

Health-Care Industry

Comprises sectors providing medical services, manufactures medical equipment or drugs, provides medical insurance, or otherwise facilitates the provision of healthcare to patients.

Price Elasticity

a measure of the responsiveness of demand or supply to changes in price, indicating how quantity demanded or supplied reacts to price variations.

Demand Curve

A graphical representation showing the relationship between the price of a good and the quantity demanded.

Price Elasticity

A measure of how much the quantity demanded of a good responds to a change in its price.