I am not trying to defend the test, and certainly not attacking you, but "public goods" is a widely understood and accepted term in economics. The definition is not at all controversial, and the relationship between public goods and government funding is a pretty bright line between liberal and conservative outlooks. Because of the way it is presented in the quiz, I would be very surprised if I were to learn that the authors are not conservative, because the question and answer, while entirely objectively correct, also support a conservative view.
To suggest that "public goods" are defined by government funding stands a generations-old debate on its head.
Again, what is meant or said or achieved by this quiz is irrelevant, but I'd really recommend that you do a little more reading before you have this discussion with a liberal.
(1) You have never responded to my counter example disproving the definition provided in the test’s “correct” answer although I have repeatedly asked if you could.
(2) You have not provided a cite, besides your own say so, for your claim that their answer is correct. I have.
(3) When I provided a citation of a definition in a dictionary you deny that cite by claiming it is an “appeal to authority”, a term used to describe a false argument in logic. That claim itself is a false argument in this case. This discussion is all about the definition of the term “public good” and, here I have provided a cite from a dictionary. You have not.
For example if we get into an argument over which team won the World Series in 1928 it is quite proper to settle by going to the record books. That is what I did.
(4) I have proved the correctness my answer over theirs by providing citation and also by logic.
I now claim that point as well. My score on this test is thus 32/33. Thank you for you help in grading the test!