Question

Nonrivalry and nonexcludability are the main characteristics of

1) consumption goods.
2) private goods.
3) public goods.
4) capital goods.

Answer 1

Nonrivalry and nonexcludability are characteristics of public goods, indicating that one person's use does not limit another's, and it's difficult to exclude non-payers from using them.

Step-by-step explanation:

Nonrivalry and nonexcludability are the main characteristics of 3) public goods. These properties signify that public goods can be used by one person without reducing their availability to others (nonrival) and it is not feasible to prevent people from using them (nonexcludable). In contrast, with private goods such as pizza, consumption by one person prevents another from consuming the same piece. A classic example of public goods is national defense: multiple individuals can benefit from it simultaneously without affecting each other's level of protection, and it is not possible to exclude individuals from its protection even if they do not contribute to its funding.