Question

The free-rider problem

A		occurs when people who do not pay for information take advantage of the information other people have to pay for.
B		suggests that the private sale of information will only be a partial solution to the lemons problem.
C		prevents the private market from producing enough information to eliminate all the asymmetric information that leads to adverse selection.
D		All of these.

Answer 1

The free-rider problem

A

occurs when people who do not pay for information take advantage of the information other people have to pay for.

B

suggests that the private sale of information will only be a partial solution to the lemons problem.

C

prevents the private market from producing enough information to eliminate all the asymmetric information that leads to adverse selection.

D

All of these.

The free-rider problem occurs when those who take advantage from resources, public goods, or services do not pay for them, which results in an underprovision of those goods or services.