An Example of a Prevention Cost Is

question 74

Multiple Choice

An example of a prevention cost is

• A)field testing.
• B)quality audits.
• C)reinspection.
• D)repair costs.

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Definitions:

Market Prices

The existing rate at which one can buy or sell an asset or service.

Profit-Seeking

The motivation or strategy of businesses and individuals to increase their financial gains or profits.

Property Rights

Legal rights to use, manage, and obtain benefits from a resource, property, or invention.

Market Organization

A method of organization in which private parties make their own plans and decisions with the guidance of unregulated market prices. The basic economic questions of consumption, production, and distribution are answered through these decentralized decisions.