What are the two characteristics that differentiate private goods from public goods? rev: 04_09_2018 Multiple Choice ownership and usage rivalry and excludability negative externality and positive externality marginal cost and marginal benefit

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Nylah

Business

16 November, 18:33

What are the two characteristics that differentiate private goods from public goods? rev: 04_09_2018 Multiple Choice ownership and usage rivalry and excludability negative externality and positive externality marginal cost and marginal benefit

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Hamza Deleon · Answer 1

Answer: Option (B) is correct.

Explanation:

Rivalry and excludability are two primary characterstics that differentiate private good and public good.

Rival good refers to the good whose consumption level falls and less will be available for the next individual. Rival good is a private good.

Non-Rival good refers to the whose consumption level doesn't fall and same level of consumption available for all the people. Non-rival good is a public good.

Excludability : In case of private good, one can exclude others from consumption of a good and in case of public good, no one can exclude others from consumption of a good.