1. A government decides to intervene in an agricultural commodity market in order to stabilize the incomes of the producers. it does this by:
B. Buying stock when output is high and selling stock when output is low
2. What are public goods? What is the free rider problem associated with public goods?
A product that one individual can consume without reducing its availability to another individual and from which no one is excluded. Economists refer to public goods as "non-rivalrous" and "non-excludable". National defense, sewer systems, public parks and basic television and radio broadcasts could all be considered public goods.
3. Common resources such as the oceans and the skies are similar to public goods becasue they are both:
B. Non-excludable and non-rival in consumption
Correct Answers were given by:
Zenaida, Saniya, Sanita of F.Y.B.Com.
Stella, Olivia, of S.Y.B.Com.
B. Buying stock when output is high and selling stock when output is low
2. What are public goods? What is the free rider problem associated with public goods?
A product that one individual can consume without reducing its availability to another individual and from which no one is excluded. Economists refer to public goods as "non-rivalrous" and "non-excludable". National defense, sewer systems, public parks and basic television and radio broadcasts could all be considered public goods.
The free-rider problem says that a rational person will not contribute to the provision of a public good because he does not need to contribute in order to benefit.
For example, if X doesn’t pay his taxes, he still benefits from the government's provision of national defense by free riding on the tax payments of his fellow citizens
3. Common resources such as the oceans and the skies are similar to public goods becasue they are both:
B. Non-excludable and non-rival in consumption
Correct Answers were given by:
Zenaida, Saniya, Sanita of F.Y.B.Com.
Stella, Olivia, of S.Y.B.Com.
