The Market Demand Curve for a Public Good

question 113

Multiple Choice

The market demand curve for a public good

• A) is derived in the same manner as demand curves for private goods.
• B) is derived by horizontally summing all individual demand curves.
• C) shows the total value that all individuals place on each additional unit of the good.
• D) shows the total number of units that would be produced by the public sector at each possible price.

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Definitions:

Interstate Commerce Act

A regulatory law enacted in the United States in 1887 to address unfair practices in the railroad industry and to regulate interstate commerce.

Federal Trade Commission Act

The federal law of 1914 that established the Federal Trade Commission.

Herfindahl Index

A measure of market concentration that squares the market share of each firm competing in the market and then sums the resulting numbers.

Market Shares

The portion of a market controlled by a particular company or product, often expressed as a percentage of total sales within that market.