According to Public Choice Theory, People Do Not Always Make

question 110

Multiple Choice

According to public choice theory, people do not always make informed choices because:

• A) the incentives to become informed are low as compared with the costs of being informed.
• B) they are ignorant by nature.
• C) they are irrational, so their decisions are not predictable.
• D) they believe making informed choices are the tasks only for the government.

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Definitions:

Equilibrium Price

The price at which the quantity of a good or service demanded equals the quantity supplied, leading to market equilibrium.

Equilibrium Quantity

The amount of products or services available and sought after at the market's balance price.

Equilibrium Quantity

The quantity of goods or services supplied and demanded at the equilibrium price, where supply equals demand.

Excess Demand

A scenario in which the demand for a product or service surpasses the supply available at the existing price.