What Method of Resource Allocation Depends on Willingness-To-Pay and Ability-To-Pay

question 39

Multiple Choice

What method of resource allocation depends on willingness-to-pay and ability-to-pay?

• A)command
• B)lottery
• C)market price
• D)first-come,first-served
• E)force

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Definitions:

Rational Decision Makers

Individuals or entities that make choices by systematically processing available information, evaluating the potential costs and benefits, aiming to achieve the maximum level of satisfaction.

Economic Behaviors

Actions or decisions of individuals, households, and organizations regarding production, distribution, and consumption of goods and services.

Mental Processes

The internal cognitive operations that underlie thinking, reasoning, perception, and emotional responses.

Behavioral Economics

The study of psychological, cognitive, emotional, cultural, and social factors on the economic decisions of individuals and institutions.