Which of the following is an example of a nonexcludable and rival good?

• A. Public highway
• B. National defense
• C. Private club membership
• D. Clean water for a restaurant

Answer: (A)

Nonexcludable means you can’t easily prevent people from using it, and rival means one person’s use reduces how much is left for others. A public highway fits this well: it’s hard to block drivers from using the road, but when many cars are on it, congestion means each driver has less space and a slower trip. That combination—accessible to all, with use by one reducing others’ access—is the hallmark of a nonexcludable and rival good.

National defense, by contrast, protects everyone and one person’s protection doesn’t lessen another’s, so it’s nonexcludable and nonrival. A private club membership is excludable because a club can admit or bar members, and it isn’t inherently rival in consumption. Clean water for a restaurant is excludable (you can charge for it and restrict usage) and is rival when scarce, since heavy use by one customer reduces what’s available for others.