Question

What are reasons due to which private producers do not take up production of public utilities?

• A. It requires huge investment.
• B. Returns from sale of utilities is very low.
• C. There is no market price, since, utilities are collectively consumed.
• D. All of the above.

Answer 1

The correct option is D All of the above.

Since the population is so huge that if any single private producer will come with a public utility product, it will require huge investment to satisfy all wants. Moreover, compared to other business the returns are very less in such kind of business as market price cannot be measured due to very widespread of distribution and consumption.