Public goods Flashcards
1
Q
What conditions satisfy a rival product?
A
- Can only be consumed by only one person
- Can be consumed by more than one person, but not at same time
2
Q
What is an excludable product?
A
You can be prevented from using it if you refused to pay
3
Q
What are the two categories for excludable products?
A
Products where non payers:
- Could be but ARE excluded
- Could be but are NOT excluded
4
Q
What is a free rider?
A
A person who recieves the benefit of a good but does not pay for it
5
Q
How does a government decide on whether to spend public money?
A
- Cost benefit analysis
- Spend on what wins most votes
6
Q
How can you split/classify goods?
A
- Rival and non rival
- Excludable and non excludable
