Which of the following best describes a public good?

• A. A good that is only accessible to specific individuals
• B. A good or service whose benefits are available to all regardless of their contribution
• C. A good that generates revenue for a company
• D. A service that requires individual payments

Answer: (B)

A public good is characterized by its non-excludability and non-rivalrous nature, meaning that once it is provided, everyone can benefit from it without being excluded, regardless of whether they have contributed to its funding. This sets public goods apart from private goods, which can be limited to individuals who pay for them or who are provided access.

For instance, public goods often include things like national defense, street lighting, or clean air, where the benefits extend to all members of a community or society as a whole, irrespective of individual contributions. As a result, this type of good often leads to challenges in funding since individuals may not feel motivated to pay for a good from which they cannot be excluded from benefiting.

In contrast, the other options speak to goods that are either exclusive to individuals, generate profits for companies, or require individual payments—none of which fit the definition of a public good. Therefore, the correct description of a public good is one that highlights its accessibility to all individuals regardless of their contributions.