When a Good Is Nonexcludable

question 108

Multiple Choice

When a good is nonexcludable:

• A) consumers will pay the market price for it.
• B) producers will produce too much of it.
• C) a free-rider problem will arise.
• D) production will be efficient.

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Definitions:

Hypothec

A legal term primarily used in civil law jurisdictions to describe a right or security interest granted over an asset to secure the repayment of a debt without transferring title.

Fee

A payment made to a professional or an organization in exchange for services or advice.

Covenant

A formal, written agreement or promise between two or more parties, often featuring in contracts or real estate transactions.

Discharge

In legal terms, the release or extinguishment of an obligation, debt, or charge.