Private Schools Are Able to Exclude Students from Attending Classes

question 164

Multiple Choice

Private schools are able to exclude students from attending classes they offer unless students have been accepted and paid tuition and fees. This suggests that education is

• A) subject to the principle of rival consumption.
• B) subject to the free-rider problem.
• C) not subject to the exclusion principle.
• D) a public good.

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Definitions:

Call Options

Financial derivatives that give the holder the right, but not the obligation, to buy an asset at a specified price within a specific time frame.

Convertible Bonds

Bonds that can be converted into a predetermined number of the issuing company's shares at certain times during their life, usually at the discretion of the bondholder.

Warrants

Securities that grant the holder the right to purchase a company's stock at a specified price before a certain date, often attached to bonds.

Call Options

Financial contracts giving the buyer the right, but not the obligation, to buy an underlying asset or security at a specified price within a defined time period.