What is the free-rider problem? What will be an ideal ...

[debasdf]

What is the free-rider problem?
 
  What will be an ideal response?

Question 2

Lucas and Sargent argue that the short-run trade-off between unemployment and inflation is caused by
 
  A) workers and firms rapidly adjusting wages and prices in response to changes in expectations.
  B) workers and firms using all the information available to predict inflation.
  C) workers and firms being fooled by unexpected changes in monetary policy.
  D) workers and firms using Fed policy to predict inflation.

[yifu223]

Answer to Question 1

The free-rider problem exists when people can enjoy the benefits of public goods whether they pay for them or not. Usually they are unwilling to pay for them.

Answer to Question 2

C