Q.Which of the following is a free good?

A free good is available in unlimited supply relative to human wants, so it commands no price and no one needs to economise its use.

Free goods are goods provided by nature in such abundance that no effort or payment is needed to obtain them, and their supply exceeds the demand for them at a zero price — for example sunlight, air, and (in most places) rainwater.

• (a) Petrol is an economic good: it is scarce, requires extraction and refining, and commands a price.
• (b) Sunlight is a free good: it falls on everyone in unlimited quantity and cannot be bought or sold.
• (c) Agricultural land is an economic good: it is scarce (fixed in supply) and is bought, sold and rented.
• (d) Drinking water sold in a bottle is an economic good precisely because bottling, purifying and transporting it converts a naturally available resource into a scarce, priced commodity.

Students often confuse 'natural' with 'free' — water and land are natural resources too, but the moment they become scarce relative to demand (agricultural land, bottled water) they turn into economic goods, not free goods. The test is scarcity relative to demand at a zero price, not the mere fact of occurring in nature.