Why Do Children Tend Not to Understand the Value of Money

question 105

Multiple Choice

Why do children tend not to understand the value of money until they see all of the wonderful things that it can buy?

• A) Because money is a secondary reinforcer, and only primary reinforcers provide gratification.
• B) Because money is a secondary reinforcer, whose value becomes satisfying or pleasurable through experience .
• C) Because children have learned that money must be earned, and therefore receiving it does not feel like a reward or reinforcer, but rather like a payment.
• D) Because children do not have the cognitive skills necessary to make the connection between an abstract concept like money and a concrete concept like a toy or candy.

---

Definitions:

Marginal Benefit

Refers to the additional satisfaction or utility that a person receives from consuming an additional unit of a good or service.

Marginal Benefit

The additional satisfaction or utility gained by consuming one more unit of a good or service, important for decision-making in consumption and production.

Marginal Benefit

The extra pleasure or benefit gained by an individual from consuming one more unit of a product or service.

Profit-Maximizing Principle

The economic principle that firms operate to achieve the highest possible profit from their operations, by adjusting output levels, pricing, or resource usage.