Provision of public goods and economic efficiency

(a) Describe some of the items included in the national security of the United States and explain whether they are public goods or private goods.

(b) Why might the national security provision exceed the efficient level?

(c) Give any reason why the national security provision might be less than the efficient level.

The theme is intended to offer the opportunity to explore the impact that government intervention has on markets. Understanding of the following concepts must be demonstrated: market failures, public goods or services, common resources, and economic efficiency.