Competitive Markets Are Unlikely to Produce the Efficient Quantity of a Public

question 66

Multiple Choice

Competitive markets are unlikely to produce the efficient quantity of a public good because:

• A)public goods are nonrival in consumption but exclusion costs are low.
• B)public goods are nonrival and are characterized by nonexclusion.
• C)the marginal benefit derived from a public good is less than the marginal cost of producing the good.
• D)the marginal benefit of a public good increase with an increase in consumption of the good.

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Definitions:

Liquidity

The measure of how easily an asset can be converted into cash without affecting its market price.

Asset Management

The process of developing, operating, maintaining, and selling assets in a cost-effective manner.

Debt Management

The process of strategizing to reduce or pay off outstanding debts.

Profitability

A metric or concept that measures the ability of a company or business to generate income relative to its revenue, assets, or shareholders' equity, typically expressed as a percentage.