Providing Public Goods

Providing Public Goods Economics E. Napp

1) What is a public good? ______

List three examples of public goods: ______

List two reasons it would be impractical to make individuals or companies provide these goods: ______

How are public goods paid for? ______

Who creates public goods? ______

2) A free rider is a person who would not choose to pay for a certain good or service, but who would benefit anyway if it were provided as a public good.

Why are the majority of us free riders at heart? ______

How does the government address the problem of the free rider? ______

3) What is a market failure? ______What does the government do when a market failure occurs? ______

4) List two differences between the public sector and the private sector: ______

5) What is an externality? ______

Externalities can be positive or negative. Why? ______

Provide two examples of positive externalities: ______

Provide two examples of negative externalities: ______

Give an example of the government’s attempts to encourage positive externalities: ______

Give an example of the government’s attempts to limit negative externalities: ______

6) After studying this lesson, why do you think taxation exists? ______