The market provision of the public good.
Answer to Problem 4MCQ
From the available options, the correct option is an inefficiently low quantity of the good and an inefficiently high
Explanation of Solution
The market provision of public goods results in an inefficiently low production of goo and high prices because the inefficient distribution of goods in the market causes a low quantity of goods and producers cannot easily sell the goods to consumers such as payment of taxes etc. raising the price of goods.
Therefore, the quantity would not be efficient or high and the price would not be inefficiently low or efficient which means the correct option is d (inefficiently low quantity of the good and an inefficiently high price).
Introduction: Excludable refers to the situation when according to people's
A public good covers both non-excludable as well as non-rival. And, a private good is excludable and rival in consumption which may prevent people from consuming when one person consumes the same good.
Chapter 76 Solutions
Krugman's Economics For The Ap® Course
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