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SingaporeEconomicsQuick questions
Market Failure and Intervention
Quick questions on Public goods and merit goods explained: H2 Economics
4short Q&A pairs drawn directly from our worked dot-point answer. For full context and worked exam questions, read the parent dot-point page.
What are merit goods?Show answer
Crucially, merit goods are rival and excludable, so the market does provide them, just too little. Two forces cause under-consumption: positive externalities (, as with education's spillovers) and information failure or short-sightedness, where consumers underestimate the future private benefit. Governments respond with subsidies, direct provision or, for the strongest cases, compulsion.
What is q1?Show answer
State the two properties of a pure public good. [2 marks]
What is q2?Show answer
Explain the free-rider problem. [3 marks]
What is q3?Show answer
Explain why education is a merit good. [2 marks]
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