Two important features of public goods are :

Non-excludable and Non-rivalrous

The correct answer is option (4) : Non-excludable and Non-rivalrous

1. Non-excludable: This means that once a public good is provided, it is not possible to exclude individuals from using it. For example, once a lighthouse is built, its light is available for all ships to use, and no ship can be prevented from benefiting from it.

2. Non-rivalrous: This means that one person's use of the public good does not reduce its availability to others. For instance, when one person benefits from a national defense system, it does not diminish the protection available to others in the same country.

To illustrate, think of public parks or street lighting:

• Public Park:

  • Non-excludable: Anyone can enter and enjoy the park without being excluded.
  • Non-rivalrous: One person enjoying a walk in the park does not prevent others from doing the same.

• Street Lighting:

  • Non-excludable: Once the street lights are on, everyone in the area benefits from the light.
  • Non-rivalrous: One person using the light does not reduce the amount of light available to others.

These characteristics differentiate public goods from private goods, which are typically excludable (you can prevent people from using them) and rivalrous (one person's use diminishes the availability for others).