(a) What are the two defining characteristics of public good? Explain what those characteristics mean, and how they are present in a public good but not in a private good. Give two examples of public good and explain how it has those characteristics.
(b) Explain how a "club good" differs from both a public good and a private good. Give an example of a club good.
(c) Could private provision of a public good occur? Give an example of how this might occur.
(d) If there were the private provision of a public good, would the level of a provision be optimal? Explain the reason for your answer, both in general and also with respect to the particular example you offered in (c).
(e) What is the marginal cost of supplying an extra unit of a club good? Is the level of a club good supplied likely to be socially optimal?
(a) What are the two defining characteristics of public good? Explain what those characteristics mean, and how they are present in a public good but not in a private good. Give two examples of public good and explain how it has those characteristics.
(b) Explain how a "club good" differs from both a public good and a private good. Give an example of a club good.
(c) Could private provision of a public good occur? Give an example of how this might occur.
(d) If there were the private provision of a public good, would the level of a provision be optimal? Explain the reason for your answer, both in general and also with respect to the particular example you offered in (c).
(e) What is the marginal cost of supplying an extra unit of a club good? Is the level of a club good supplied likely to be socially optimal?