The market system does not produce public goods because:

A) there is no need or demand for such goods.
B) private firms cannot stop consumers who are unwilling to pay for such goods from benefiting from them.
C) public enterprises can produce such goods at lower cost than can private enterprises.
D) their production seriously distorts the distribution of income.

Public Goods

Goods that are available for everyone to consume, regardless of whether they pay for them or not, and whose consumption by one individual does not diminish the quantity available to others.

Private Firms

Businesses that are owned, operated, and managed by private individuals or entities rather than by the government or public.

Consumers

Individuals or groups that purchase goods and services for personal use.