1. Because public goods are:
a. Excludable, people have an incentive to be free riders.
b. Excludable, people do not have an incentive to be free riders.
c. Not excludable, people do not have an incentive to be free riders.
d. Not excludable, people have an incentive to be free riders.
Ā
2. The provision of a public good generates a/an
a. Negative externality, as does the use of a common resource.
b. Positive externality and the use of a common resource generates a negative externality.
c. Negative externality and the use of a common resource generates a positive externality.
d. Positive externality, as does the use of a common resource.
Ā
3. When goods are available free of charge, the market forces that normally allocate resources in our economy are absent.
a. True
b. False