The Free Rider Problem Occurs

question 4

Multiple Choice

The free rider problem occurs:

• A)when externalities are unaccounted for.
• B)for both exclusive and non-exclusive goods.
• C)when a governmental body intervenes in the workings of a private market.
• D)a consumer consumes a good that others pay for but pays nothing herself.

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Definitions:

Clan Control

A method of managing based on shared values, beliefs, norms, and traditions among company members, which influences members' behaviors and contributes to organizational culture.

Organizational Culture

The shared values, beliefs, and practices that shape the social and psychological environment of an organization.

Sarbanes-Oxley Act

A U.S. federal law enacted in 2002 to protect investors from fraudulent financial reporting by corporations, also known as the SOX Act.

Financial Reporting

The process of producing statements that disclose an organization's financial status to management, investors, and the government.