ECONOMICS
FISCAL POLICY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Fireworks displays usually take place in a public area.
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Fireworks are a scarce resource.
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Nonpayers cannot be prevented from seeing the fireworks.
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Each consumer pays a fee to see the fireworks.
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Detailed explanation-1: -Which of the following explains why a city firework display on the Fourth of July is provided as a public good? Nonpayers cannot be prevented from seeing the fireworks.
Detailed explanation-2: -The government provides society with certain public goods because it would be inefficient or impractical for a free market economy to provide these goods on its own.
Detailed explanation-3: -For which of the following reasons does the free market fail to adequately provide public goods? There is very little incentive for individuals to pay for, or businesses to provide, nonexclusive services.
Detailed explanation-4: -Which of the following explains how the government provides the optimal quantity of a public good? it compares the marginal benefit of an added unit of the good against the government’s marginal cost of providing it.
Detailed explanation-5: -The police department is also considered as a public good. It is because that improved security and lower crime will benefit everyone in the community as a result of your efforts to maintain law and order.