Negative Incentive
What will be an ideal response?
any kind of incentive to discourage you to take action
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As a result of a decline in the expected rate of return on investment, GDP would not have to fall if the government __________ taxes or __________ government spending
A) increased; increased B) increased; decreased C) decreased; increased D) decreased; decreased
Suppose a consumer is spending his or her entire budget. In order to obtain the most satisfaction from his or her purchases, all goods should:
a. provide the same marginal utility per dollar. b. be consumed in equal quantities. c. have identical marginal utilities. d. give the consumer matching amounts of total utility.
Which of the following statements about a monopolistically competitive firm, in the short run, is true?
a. Profits will be maximized at the point at which price equals marginal cost and hence there is no deadweight loss. b. The firms earn zero economic profit in the short run. c. The firms achieve allocative and productive efficiency in the short run. d. Advertising may enable a firm to charge a higher price than that charged by rival firms. e. It faces a perfectly elastic demand curve.
A financing gap is:
A. the difference between the savings rate within an economy and the amount of investment needed to achieve sustainable growth. B. the extra savings a country has beyond that needed to achieve sustainable growth. C. the difference in the amount of investment dollars coming in to a country and the amount of investment dollars going out of a country. D. the extra investment developing countries need in foreign aid to sustain their current rate of growth.