Card 1 of 20
Why are merit goods under-consumed in free markets?
A
- Consumers undervalue private costs, often because of imperfect information.
- They ignore negative externalities imposed on wider society.
B
- Consumers overvalue private costs, often because of perfect information.
- They include positive externalities benefiting wider society.
C
- Consumers undervalue private benefits, often because of imperfect information.
- They ignore positive externalities benefiting wider society.
D
- Consumers overvalue private benefits, often because of imperfect information.
- They ignore negative externalities imposed on wider society.
Card 1 of 20
1.8.5 Merit and demerit goods Flashcards
20 flashcards on AQA A Level Economics 1.8.5 Merit and demerit goods: the key terms, economic models and case studies you need to recall for Paper 1, Paper 2 and Paper 3.