Economic Systems Quiz
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Questions and Answers

What is the Incentive Principle?

  • A person is more likely to take action if the benefit increases. (correct)
  • A person is less likely to take action if the cost increases.
  • A person is less likely to take action if the cost decreases.
  • A person is more likely to take action if the benefit decreases.
  • What kind of action is a person more likely to take according to the Incentive Principle?

  • When the cost increases
  • When the benefit increases (correct)
  • When the cost decreases
  • When the benefit decreases
  • Based on the text, what makes a person less likely to take an action?

  • Increase in cost (correct)
  • Increase in benefit
  • Decrease in benefit
  • Decrease in cost
  • When a person is more likely to take an action, what typically happens to the benefit?

    <p>Increases</p> Signup and view all the answers

    In what scenario is a person less likely to take an action based on the Incentive Principle?

    <p>When the cost increases</p> Signup and view all the answers

    What factor influences a person's likelihood of taking an action according to the text?

    <p>Increase in benefit and decrease in cost</p> Signup and view all the answers

    According to the Incentive Principle, why would a person be less likely to take an action?

    <p>Because the cost increases</p> Signup and view all the answers

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