Public Goods Face the

question 303

Multiple Choice

Public goods face the

• A) principle of rival consumption.
• B) free-rider problem.
• C) law of overproduction.
• D) exclusion principle.

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Definitions:

Promoter

A person who incorporates a business, organizes its initial management, and raises its initial capital.

Preincorporation Contract

An agreement made by the incorporators or promoters of a company on behalf of the company before it has been legally formed.

Liable

Legally responsible or obligated to compensate for harm, loss, or damage caused by one's actions or omissions.

Capitalize

The accounting practice of recording a cost or expense on the balance sheet for the purposes of delaying full recognition of the expense over time through depreciation or amortization.