The Incentive Principle is an example of:
A. a positive economic principle.
B. an economic decision-making pitfall.
C. a normative economic principle.
D. over-estimating the benefits of an action.
Answer: A
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The rules of the National Collegiate Athletic Association (NCAA) limit the amount of money colleges can offer to athletes to
A) assure balanced competition on collegiate athletic fields. B) maintain high ethical standards in college sports. C) preserve the spirit of amateurism in an age of professionalism. D) prevent competition for star athletes from raising the price of enrolling them. E) prevent the schools with the most profitable athletic programs from attracting more than their share of the best athletes.
In the above figure, if the minimum wage is set at $6 per hour, what quantity of labor is employed?
A) 100 million hours B) 200 million hours C) 300 million hours D) 400 million hours
In the above figure, the inflationary gap can correctly be identified as
A) the difference between 125 and 120. B) the difference between 12.2 trillion and 12 trillion. C) LRAS minus SRAS. D) AD1.
At Tony's Restaurant, the quantity of large pizzas sold is 200 at the unit price $15. Suppose the price elasticity of demand for pizzas by the initial value method is 1.5, and you would like to increase the quantity sold to 250. Then the new price must be:
A. $13. B. $12.50. C. $11.50. D. $11.25.