The Free Rider Problem Is a Situation in Which

question 14

Multiple Choice

The free rider problem is a situation in which

• A)effluents such as CFCs combine with ozone and decrease concentrations of that protective chemical.
• B)one agent secures benefits that others pay for.
• C)there are excessive subsidies given to polluting buses or other forms of mass transit.
• D)perfect property rights exist.

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Definitions:

Upward Slope

A line on a graph that displays a positive relationship between two variables, indicating that as one variable increases, the other variable also increases.

Price Takers

Businesses or individuals that accept the prevailing prices in the market because they do not have enough power to influence them.

Competitive Market

A market structure characterized by many buyers and sellers, free entry and exit, and products that are similar enough to be considered substitutes.

Market Supply Curve

A graphical representation showing the quantity of a good that producers are willing and able to sell at various prices within a specific time period.