Multiple Choice
Why were states willing to invest the time and money needed to build canals, considering the characteristics of public goods and their demand curve?
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8. The Types of Goods
Public Goods: Demand Curve and Optimal Quantity
Multiple Choice
When a salesperson calls you to sell a cemetery plot, this is most likely an example of which type of good?
A
Club good
B
Private good
C
Public good
D
Common resource
Verified step by step guidance1
Step 1: Understand the characteristics of different types of goods in microeconomics. These include private goods, public goods, club goods, and common resources, each defined by their excludability and rivalry in consumption.
Step 2: Recall that a private good is both excludable and rivalrous, meaning that people can be prevented from using it, and one person's use reduces availability for others.
Step 3: Recognize that a public good is non-excludable and non-rivalrous, so no one can be prevented from using it, and one person's use does not reduce availability for others.
Step 4: Identify that a club good is excludable but non-rivalrous, meaning access can be restricted but one person's use does not diminish availability for others.
Step 5: Note that a common resource is non-excludable but rivalrous, so people cannot be easily prevented from using it, but one person's use reduces availability for others. Since a cemetery plot is excludable and rivalrous, it fits the definition of a private good.
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