Question

What are the two key characteristics of public goods?

Short answer

Public goods are nonexcludable and non-rival.

Step-by-step solution

Content Introduction

Market producers cannot sell public goods to individual consumers because they are produced for the entire society. All products subsidized by taxes, on the other hand, are not considered public goods.

Content Explanation

Two essential characteristics of a public good are nonexcludable and nonrivalry. The term "nonexcludable" refers to the fact that one consumer cannot or will not be able to prevent another from using the goods. The phrase "non-rival" refers to the fact that one person's use of a product does not prevent others from doing so as well.