question
excludable good
answer
If a person can be prevented from using the good.
Ex: Food
Ex: Food
question
non-excludable good
answer
If a person cannot be prevented from using the good.
Ex: AM/FM radio signals, national defense
Ex: AM/FM radio signals, national defense
question
rival in consumption
answer
If a person's use of the good diminishes other people's use.
Ex: Tacos
Ex: Tacos
question
non-rival in consumption
answer
If a person's use of the good does not diminish other people's use.
Ex: MP3 of a song
Ex: MP3 of a song
question
private good
answer
A good that is excludable and rival in consumption
- Can be prevented from using it; use of it can diminish other's use
Ex: food
- Can be prevented from using it; use of it can diminish other's use
Ex: food
question
public good
answer
A good that is non-excludable and non-rival in consumption
-Cannot be prevented from using it; use of it cannot diminish other's use
Ex: national defense
-Cannot be prevented from using it; use of it cannot diminish other's use
Ex: national defense
question
common resource
answer
A good that is rival in consumption and non-excludable
-Use of it can dimish other's use; person cannot be prevented from using it
Ex: fish in the ocean
-Use of it can dimish other's use; person cannot be prevented from using it
Ex: fish in the ocean
question
club good
answer
A good that is non-rival in consumption and excludable
-Use of it cannot diminish other's use; person can be prevented from using it
Ex: cable tv
-Use of it cannot diminish other's use; person can be prevented from using it
Ex: cable tv
question
free rider
answer
A person who receives the benefit of a good but avoids paying for it.
Ex: If a good is non-excludable, people cannot be prevented from using it, therefore provides an incentive to be a free rider.
Ex: If a good is non-excludable, people cannot be prevented from using it, therefore provides an incentive to be a free rider.
question
cost-benefit analysis
answer
A study that compares the costs and benefits of providing a public good.
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