--%>
Assignment Help - homework help

Free-rider problem

Explain the two characteristics of public goods? Describe the significance of each for public provision as opposed to private provision. Depict the free-rider problem as it associate to public goods?  Is the Canadian border patrol a public good or a private good?  Why?  How regarding satellite TV?  Describe.

E

Expert

Verified

Public goods are non-rival (one person’s consumption does not avoid consumption by another) and non-excludable (once the goods are generated nobody including free riders can be excluded through the goods’ benefits).  If goods are non-rival, there is less incentive for private firms to generate them – those purchasing the good could just let others the employ without compensation. Similarly, if goods are non-excludable, private firms are unlikely to produce them as the potential for profit is low. The free-rider problem occurs while people benefit from the public good without contributing to the cost (tax revenue proportionate to the benefit attained). The Canadian border patrol is a public good – my use and benefit does not prevent yours. Satellite TV is a private good – if the dish, receiver, and service go to my residence it can’t go to my neighbours. The fact that I could invite my neighbour over to watch does not alter its status from being a private good.

   Related Questions in Finance Basics

  • Q : Describe factors which common

    Describe some factors which common stockholders consider while deciding how much, if any, cash dividends they want from the corporation wherein they have invested? Common stockholders would assume the company's investment opportunity, their requ

    		•
  • Q : Explain Department of Finance

    Department of Finance (Finance): The Director of Finance functions as the Governor’s chief fiscal policy advisor with the emphasis on financial integrity of the state. Finance is delegated the accountability for preparation of the Governor's Bud

    		•
  • Q : Change in GDP Normal 0 false false

    Normal 0 false false

    		•
  • Q : Describe the equilibrium price and

    Assume the total demand for wheat and the net supply of wheat per month in the Kansas City grain market are as: 16_Table for wheat.png

    		•
  • Q : Define Spot Bill Spot Bill : It is an

    Spot Bill: It is an introduced bill which makes non-substantive modifications in a law, generally with the intent to amend the bill at a later date to comprise substantive law modifications. This procedure gives a means for circumventing the deadline

    		•
  • Q : Define CALSTARS CALSTARS : The acronym

    CALSTARS: The acronym for the California State Accounting and Reporting System that is the state's primary accounting system. Most of the departments presently use CALSTARS.

    		•
  • Q : Define Senate Senate : The higher house

    Senate: The higher house of California’s Legislature comprising of 40 members. As an outcome of Proposition 140 (that is, 1990, term limits) and Proposition 28 (that is, 2012, limits on Legislators’ terms in office), members chosen in or a

    		•
  • Q : State Schedule 11 Schedule 11 : It is

    Schedule 11: It is the outdated word for “Supplementary Schedule of Operating Expenses and Equipment.”

    		•
  • Q : How management incorporated in proforma

    Describe how management aims are incorporated into proforma financial statements.Management decide a target goal, and forecasters generate proforma financial statements under the assumption that the goal will be

    		•
  • Q : Explain Section 26.00 Section 26.00 :

    Section 26.00: It is a Control Section of Budget Act which gives the authority for the transfer of funds from one class, program or function in a schedule to the other category, program or function in the similar schedule, subject to particular limita

    		•