It's a Very Hot Summer Day and Ai Is Sweating

question 37

Multiple Choice

It's a very hot summer day and Ai is sweating in her apartment. She turns on the air-conditioning and right away her apartment gets cooler. Ai is now more likely to turn on the AC when she is hot to reduce her discomfort; this is an example of

• A)positive reinforcement.
• B)negative reinforcement.
• C)punishment.
• D)a penalty.

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Definitions:

Market Prices

The price point at this moment for the sale or purchase of a service or asset.

Externalities

The cost or benefit that affects a party who did not choose to incur that cost or benefit, often not reflected in market prices.

Market Power

The ability of a firm or group of firms to influence the price and production levels of a product or service in the market.

Market Failure

A scenario where the distribution of goods and services by an unregulated market fails to be effective, frequently causing a decrease in overall social welfare.