The Free-Rider Problem Exists Because

question 19

Multiple Choice

The free-rider problem exists because

• A) private goods or services cause some people to want to take them for free.
• B) some goods or services are excludable and cause envy for those who don't have them.
• C) some goods or services that are rival and leave some people without them.
• D) people cannot be excluded from consuming public goods even if they don't pay for them.
• E) people must all consume the same public good and so everyone wants to pay for it.

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Definitions:

Secured Creditors

Creditors that have a legal claim on specific assets of the debtor as collateral for the debt, providing them with a level of protection in case of bankruptcy.

Subcontractor

An individual or company hired by a primary contractor to perform a specific task as part of a larger project.

Paid

Paid denotes a transaction or situation where money is exchanged for goods, services, or completion of a task.

Builders' Liens

Legal claims made by contractors or suppliers against a property they have worked on or supplied materials for, ensuring payment for their services.