Question 3 [20 marks] (i) What is a public good and why does the market fail...

Question 3 [20 marks] (i) What is a public good and why does the market fail in the presence of a public good? (5) (ii) Explain how we can resolve this issue where the existence of a public good causes market failure. (5) (iii) Why will private markets produce an inefficient output of a public good? Explain how the efficient level of a public good is determined. (5) (iv) Education is frequently cited as a source of external benefits. In what way, if at all will your receiving university education benefit other people? (5)

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Rahul Sunny answered 1 year ago

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