객관식
Which of the following best describes how the demand curve for a public good is derived?
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8. The Types of Goods
Public Goods: Demand Curve and Optimal Quantity
객관식
Why might firms in the defense industry invest large amounts of money in lobbyists with respect to public goods like national defense?
A
To influence government spending decisions and ensure higher provision of national defense, which benefits them as suppliers.
B
To decrease the demand for public goods and increase private market competition.
C
To privatize national defense and exclude non-payers from its benefits.
D
To reduce the free-rider problem associated with national defense.
검증된 단계별 안내1
Step 1: Understand the nature of public goods, such as national defense, which are non-excludable and non-rivalrous, meaning that individuals cannot be excluded from their benefits and one person's consumption does not reduce availability to others.
Step 2: Recognize that because public goods are typically provided by the government, firms that supply related products or services (like defense contractors) have a vested interest in the level of government spending on these goods.
Step 3: Analyze why firms might invest in lobbyists: lobbying is a strategic activity aimed at influencing government decisions, particularly budget allocations and policies that affect the provision of public goods.
Step 4: Connect the firm's goal to increase government spending on national defense with their investment in lobbyists, as higher government spending translates into more contracts and revenue for these firms.
Step 5: Conclude that the primary reason firms invest in lobbyists is to influence government spending decisions to ensure a higher provision of national defense, which directly benefits them as suppliers, rather than to decrease demand, privatize the good, or address the free-rider problem.
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