Answer to Question #71424 in Microeconomics for Avanelle

Question

Charlie loves watching Sponge Bob on his local TV station but he never sends any money to support the station during its fund raising drives. what type of market failure do the statement applies to

Answer 1

This type of market failure is called Free rider problem. It is in the actions of the consumer of the public good, which tries to avoid paying for the use of this good.