When the Government Hires People to Serve in the Army

question 133

Multiple Choice

When the government hires people to serve in the army, these people are no longer available to do other work. This choice illustrates the concept of

• A) an incentive.
• B) a social interest/private interest conflict.
• C) opportunity cost.
• D) marginal benefit.

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Definitions:

Proportional

Pertaining to a relationship where changes in one quantity result in proportional changes in another quantity.

Elasticity

A measure of how much the quantity demanded or supplied of a good or service changes in response to a change in its price.

Efficiency Loss

The loss of economic efficiency that can occur when the equilibrium for a good or a service is not achieved or is not achievable.

Demand and Supply

The fundamental concepts of economics that demonstrate how the quantity of goods or services demanded by consumers relates to the quantity supplied by producers at various prices.