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Why Do Private Producers Have No Incentive to Provide Public

Question 15

Multiple Choice

Why do private producers have no incentive to provide public goods?


A) Because the government subsidy granted is usually insufficient to enable private producers to make a profit.
B) Because production of huge quantities of public goods entails huge fixed costs.
C) Because they cannot avoid the tragedy of the commons.
D) Because once produced, it will not be possible to exclude those who do not pay for the good.

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