The Economic Way of Thinking Stresses That

question 38

Multiple Choice

The economic way of thinking stresses that

• A) changes in personal costs and benefits generally fail to exert much impact on behavior.
• B) incentives matter--individuals respond in predictable ways to changes in personal costs and benefits.
• C) if one individual gains from an economic activity, then someone else must lose and in the same proportion.
• D) if a good is provided by the government, its production will not consume valuable scarce resources.

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Definitions:

Personal Assets

Assets owned by an individual, including tangible and intangible items of value such as real estate, investments, and personal property.

Unlimited Life

A characteristic of corporate entities indicating they can continue to exist indefinitely, beyond the lives of their owners or members, unless dissolved.

Mutual Agency

The principle in a partnership where each partner is empowered to commit the firm to a contract within the scope of the business’s operations.

Co-Ownership

A legal arrangement where two or more parties hold property rights simultaneously in the same asset or property.