Which of the following is true?
a. Consumption of a public good by one individual reduces the availability of the good for others.
b. It is extremely difficult to limit the benefits of a public good to the people who pay for it.
c. Public goods are free whenever the government produces them.
d. From an efficiency standpoint, a market economy will generally supply too much of a public good.
Question 2
Attempts to use activist policies to stabilize the economy can be counter-productive:
a. If policy makers do not correctly estimate the natural rate of real output.
b. If policy makers misestimate the lags involved in the process.
c. If policy makers forecast inaccurately.
d. In all of the above cases.
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