Better Insurance Benefits Increase the Incentive of Some Individuals to Work

question 200

Multiple Choice

Better insurance benefits increase the incentive of some individuals to work. This statement is best described as

• A) a positive statement.
• B) an example of the ceteris paribus assumption.
• C) a normative statement.
• D) a comparative economics statement.

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Definitions:

Variable Costs

Charges that adjust in direct proportion to the manufacturing output or the quantity of sales.

Fixed Costs

These are consistent expenses incurred by a business, regardless of production levels or sales volumes, such as rent or salaries.

Profit-Volume Chart

A chart plotting only the difference between total sales and total costs for various levels of units sold.

Break-Even Point

The point at which total costs and total revenues are equal, meaning a business neither makes a profit nor suffers a loss.