Which of the following is an example of a market failure caused by the existence of a public good?
A. A levee is not built because no one wants to pay for it, even though everyone agrees that it is important.
B. We send a chimpanzee to space. You think it would be better if we send a lemur.
C. We spend $300 billion for national defense. You think it is too much.
D. McDonalds is your favorite restaurant. Other people think the food they serve is unappealing.
Answer:A
Which of the following is an example of a market failure caused by the existence of a public good?
A. A levee is not built because no one wants to pay for it, even though everyone agrees that it is important. B. We send a chimpanzee to space. You think it would be better if we send a lemur. C. We spend $300 billion for national defense. You think it is too much. D. McDonalds is your favorite restaurant. Other people think the food they serve is unappealing.