Paul Commutes to and from Work Each Day

question 122

Multiple Choice

Paul commutes to and from work each day. Although he drives by himself he often speeds along in the carpool lane on the highway. When confronted with his behavior he argues "Well, half the drivers in that lane are alone too." Paul's response demonstrates

• A) the false uniqueness effect.
• B) the self-serving bias.
• C) the false consensus effect.
• D) the defensive pessimism.

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Definitions:

Legal Structure

The framework within which a business operates, including its designation as a corporation, partnership, sole proprietorship, or other legal entity.

Barrier To Entry

Factors that make it difficult for new competitors to enter a market, such as high start-up costs or regulatory hurdles.

Price-Control Legislation

Laws enacted by a government to regulate the prices charged for goods and services in the market, often to protect consumers.

Invisible Hand Principle

The tendency of market prices to direct individuals pursuing their own interests to engage in activities promoting the economic well-being of society.