Why Do Changes in Institutional Design Alter Outcomes

question 18

Multiple Choice

Why do changes in institutional design alter outcomes?

• A) Outcomes are outside the scope of institutions, and thus have no effect.
• B) Outcomes are only possible to be changed through elections, and thus changes to election laws will produce much change.
• C) Institutions are only collections of rules, and thus have no effect on outcomes.
• D) Outcomes are determined by institutional structures and rules, and thus changing the institution changes outcomes.
• E) Institutions are equal to outcomes; thus, changing one completely undermines the other.

---

Definitions:

Expense Function

A mathematical function that describes the cost associated with a particular level of production or activity.

Revenue Function

A Revenue Function is a mathematical representation of how a company's revenue is dependent on the selling price and quantity of goods or services sold.

Supply Curves

Graphs showing the relationship between the price of a good and the quantity of that good a seller is willing to supply.

Demand Curves

A graphical representation showing the relationship between the price of a good and the quantity demanded by consumers.