A Competitive Market Economy Is Unlikely to Provide an Efficient

Multiple Choice

A competitive market economy is unlikely to provide an efficient quantity of some public goods because:

A) only the government has the vast resources necessary to produce public goods.
B) the nature of public goods makes it difficult for producers to withhold them from nonpaying consumers.
C) the technology involved in the production of public goods makes it difficult for private firms to produce them even though, once produced, they could be marketed efficiently.
D) private production of public goods generally results in a large amount of profit, which is difficult for a firm to effectively pay out to shareholders.