Free riding can occur if a good is _______
Which of the following options suits best in the above blank?
Answer & explanation
Correct answer: option 3
The correct answer is Option 3:Non excludable and non-rival
'Free riding can occur if a good is non-excludable and non-rival.
When a good is non-excludable, it means that individuals cannot be effectively excluded from using the good. When it is non-rival, it means that one individual's use of the good does not reduce its availability to others. These characteristics lead to the free-rider problem, where individuals can benefit from the good without contributing to its cost, because they cannot be excluded from its use.