Question

For each of the goods, identify the characteristics that describe each good. Note that each good will be described with two characteristics. Rivalrous is also referred to as rival in consumption. Consider only the immediate benefits and costs, not any externalities.

Answer 1

Answer:

The correct answers are:

1. Nonexcludable, nonrivalrous

2. excludable, nonrivalrous

3. excludable, rivalrous

4. excludable, rivalrous

5. excludable, rivalrous

6. excludable, rivalrous

Explanation:

A good is excludable when ordinary people haven't paid for it can be prevented from using that good. It becomes a rival if the consumption of a person in that good diminishes another one's consumption of it. Rivalry and excludability are related. A very simple example of it is when an apple cannot be shared with an unlimited number of people.