Why Are Public Goods a Source of Market Failure

question 36

Essay

Why are public goods a source of market failure?

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Definitions:

Free Competition

An economic situation in which businesses operate without undue restrictions, allowing for the natural forces of supply and demand to determine prices and output.

Age Of Majority

The age at which an individual is considered legally capable of conducting himself or herself responsibly and is entitled to vote. In contract law, the age at which one is no longer an infant and can no longer disaffirm a contract.

Legally Binding

an agreement or contract that is enforceable by law, obligating parties to fulfill their contractual duties.

Unconscionable

Actions or terms that are excessively unfair or oppressive and not guided by conscience.