When Dealing with Pure Public Goods

question 61

Multiple Choice

When dealing with pure public goods,

• A)the government must always provide them.
• B)private firms will always provide them.
• C)the government frequently provides them although private firms provide some.
• D)private firms provide nearly all of them and the government provides the few remaining ones.

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Definitions:

Government-backed Price Supports

Financial mechanisms provided by governments to maintain the market price of specific goods or commodities at a predetermined level.

Deficit Spending

The practice of spending more money than is taken in through revenues, leading to a government budget deficit, often financed by borrowing.

Demobilized Soldiers

Military personnel who are discharged back into civilian life after their service, often following the end of a war or military conflict.

Unemployment

The situation when individuals who are capable of working and are actively seeking employment are unable to find a job.