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Edexcel A-Level Economics AS 1.3.5 1b Sources of Market Failure Externalities the Free Rider Problem Non Provision of Questions

Practise identifying free riding as a source of market failure when non-excludability leads to underprovision of public goods.

Syllabus
First assessment 2019
Course
Economics YEC11
Level
AS

Exam points

  • identify free riding as a market-failure source when non-excludability causes underprovision of public goods

Edexcel A-Level Economics AS 1.3.5 1b Sources of Market Failure Externalities the Free Rider Problem Non Provision of Questions question 1

[Maximum number: 1]

Which one of the following is an example of market failure?

A

The free-rider problem that results in the underprovision of public goods

B

Higher prices create an incentive for firms to increase the production of a good

C

New government regulations that result in excessive administration costs

D

Government provision of healthcare to move towards the social optimum output

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