Why Does the Market Not Provide National Defence

question 38

Multiple Choice

Why does the market not provide national defence

• A)It is impossible to prevent any single person from enjoying the benefit of national defence.
• B)The fixed cost of national defence is too high.
• C)The necessary resources for national defence are not available in the private sector.
• D)Private sectors are not willing to pay for it.

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Definitions:

Equity Multiplier

A financial ratio that measures the amount of a company's assets that are financed by its shareholders' equity.

Common Stock

A type of equity security that represents ownership in a corporation, entitling holders to a share of the corporation's profits and assets.

Market Price

The ongoing rate for transactions involving the purchase or sale of assets or services.

Debt-To-Equity Ratio

A financial proportion depicting how much of a company's assets are financed through debt versus equity from shareholders.