The Situation Where Politicians Make Decisions That Will Raise Their

question 102

Multiple Choice

The situation where politicians make decisions that will raise their chances of reelection, even if those decisions are detrimental to the general public, is referred to as the

• A) moral hazard problem.
• B) principal-agent problem.
• C) adverse selection problem.
• D) common good problem.

---

Definitions:

Absolute Threshold

The minimum intensity of a stimulus that one can perceive, signifying the point at which a stimulus becomes noticeable to our senses.

Signal Detection

A technique or process used to identify the presence or absence of a stimulus under conditions of uncertainty.

Difference Threshold

The minimum difference in stimulation that a person can detect 50% of the time, also known as the just noticeable difference (JND).

Absolute Threshold

The minimum stimulus intensity required for detection by the senses.