A Free-Rider Problem Exists When

Multiple Choice

A free-rider problem exists when:

A) individuals presume that others will pay for public goods so that, individually, they can escape from paying for their portion without reducing production of the public good.
B) individuals on one side of a market transaction possess information not available to people on the other side of the transaction.
C) a seller of an item may behave differently following agreement to undertake a transaction than they did prior to that agreement.
D) a seller of a low-quality item has the greatest incentive to try to sell that item to an uninformed buyer.