Multiple Choice
Which of the following statements is true regarding the demand curve and optimal quantity of public goods?
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8. The Types of Goods
Public Goods: Demand Curve and Optimal Quantity
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Which of the following is an example of a pure public good?
A
A toll road
B
A private swimming pool
C
National defense
D
A concert with paid admission
Verified step by step guidance1
Understand the definition of a pure public good: it is a good that is both non-excludable (people cannot be prevented from using it) and non-rivalrous (one person's use does not reduce availability to others).
Analyze each option to check if it meets the criteria of non-excludability and non-rivalry:
- A toll road is excludable because users must pay a toll, so it is not a pure public good.
- A private swimming pool is excludable and rivalrous, as only certain people can use it and usage by one person reduces availability to others.
- National defense is non-excludable and non-rivalrous because everyone benefits from it regardless of payment, and one person's protection does not reduce protection for others, making it a pure public good.
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