One Benefit to Private Sector Production of a Collective Consumption

question 33

Multiple Choice

One benefit to private sector production of a collective consumption good is _____.

• A)it overcomes the free riding problem
• B)private producers can often bundle the good with something else people value
• C)profits from private companies can be taxed
• D)provides information valuable in allocating future resources

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Definitions:

Product Differentiation

Product differentiation is the process of distinguishing a product or service from similar offerings in the market to make it more attractive to a particular target market.

Market Power

The ability of a firm or group of firms to control prices or output in a market, often leading to reduced competition.

Economic Profits

The difference between a firm's total revenue and its total costs, including both explicit and opportunity costs.