The answer is C: public goods.
Explanation for each option:
a. Private goods: These are goods that are both excludable and rivalrous, meaning that individuals can be prevented from using them, and one person's use of the good reduces its availability to others. Examples include food, clothing, and cars. City streets, sewage systems, and police protection do not fit this category because they are generally available to all and one person's use does not significantly reduce their availability to others.
b. Luxury goods: These are goods that are not necessary for survival but are desired for their perceived value or status. They are typically more expensive and not accessible to everyone. City streets, sewage systems, and police protection are essential services and do not fit the definition of luxury goods.
c. Public goods: These are goods that are non-excludable and non-rivalrous, meaning that they are available to all members of society and one person's use does not diminish their availability to others. City streets, sewage systems, and police protection are classic examples of public goods because they are provided by the government for the benefit of all citizens and are not diminished by individual use.
d. Exclusive goods: These are goods that are excludable, meaning that people can be prevented from using them if they do not pay for them. City streets, sewage systems, and police protection are not exclusive goods because they are typically funded by taxes and available to all, regardless of individual payment.
Therefore, city streets, sewage systems, and police protection are best categorized as public goods.
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