ECONOMICS
MARKET FAILURES
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Licenses to emit quantities of pollutants that can be bought and sold by polluters.
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The property of a good whereby a person can be prevented from using it.
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The property of a good whereby one person’s use diminishes other people’s use.
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A person who receives the benefit of a good but avoids paying for it.
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Detailed explanation-1: -The Different Kinds of Goods Excludability –Property of a good whereby a person can be prevented from using it Rivalry.
Detailed explanation-2: -Excludability refers to the property of a good whereby a person can be prevented from using it.
Detailed explanation-3: -A good is excludable if a person can be prevented from using it. A good is rival in consumption if one person’s use of it diminishes others’ use. If good is not excludable, people have incentive to be free riders, because firms cannot prevent non-payers from consuming the good.
Detailed explanation-4: -A good is excludable if people (ordinarily, people who have not paid for it) can be prevented from using it. It is rival, or subtractable if one person’s consumption of a good necessarily diminishes another person’s consumption of it.
Detailed explanation-5: -Rivalry in consumption is the property of a good whereby one person’s use diminishes other people’s use.