The Reason That Private Provision of a Public Good Often

question 4

Multiple Choice

The reason that private provision of a public good often leads to inefficiency is because

• A) private property rights are too costly to enforce.
• B) marginal private benefits are too costly to calculate.
• C) no one has the incentive to pay for the good.
• D) no one has an incentive to conserve the good.
• E) the tragedy of the commons occurs and too many public goods are provided.

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Definitions:

Job Costing System

An accounting method used to track costs and profitability of individual jobs or projects, allowing for precise control and reporting of expenses.

Process Costing System

A method of accounting that traces and accumulates direct costs, and allocates indirect costs of a manufacturing process, to products by averaging them over units of output.

Downstream Costs

Costs incurred after the production phase, such as distribution and marketing expenses, as well as after-sales service costs.

Upstream Costs

Expenses incurred in the early stages of the production process, which can include exploration, development, and extraction in the oil and gas industry.