Unformatted text preview: People cannot have all of the good that they want at this zero price, so society must ration out what is available. Price increases above zero until an equality is reached between consumption and production. A free good, on the other hand, is available in quantities in excess of what people desire at a zero price (free). Here the quantity available to consumers in greater that the quantity of the good desired by consumers at a price equal to zero....
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This note was uploaded on 12/29/2011 for the course ECO 210 taught by Professor Malls during the Fall '10 term at SUNY Stony Brook.
- Fall '10