The correct answer is Option (1) → (A), (B) and (C) only
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(A) Public goods are non rival in nature. (True). Non-rivalry means that one person's consumption of the good does not reduce its availability to others. For example, my enjoyment of a lighthouse beam does not prevent you from enjoying it too.
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(B) Public goods are non-excludable in nature. (True). Non-excludability means it is impractical or impossible to prevent non-payers from consuming the good. For example, you can't stop a non-payer from benefiting from national defense.
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(C) Public goods may be produced by the government or the private sector. (True). A public good is defined by its characteristics (non-rivalry and non-excludability), not by who produces it. For example, a government might hire a private company to build a non-excludable, non-rival road (a public good).
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(D) Public goods and public production can be used interchangeably. (False).
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Public goods are defined by the characteristics of non-rivalry and non-excludability.
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Public production (or public provision) means the good or service is provided by the government.
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These terms are not interchangeable. The government can produce private goods (e.g., mail delivery in some countries), and the private sector can sometimes produce public goods (as noted in C).
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