AS Paper 1, June 2025Introduction to Markets and Market Failure
AS Paper 1, June 2025, Q3(b)
Which one of the following is the most likely reason why a free market fails to achieve the social optimum position?
Multiple choice1 mark
APublic goods are provided free of charge to users
BThere is overproduction of goods with external benefits
CThere is underconsumption of goods with external benefits
DThere is underproduction of goods with external costs