The Rational-Ignorance Effect Refers to the

question 130

Multiple Choice

The rational-ignorance effect refers to the

• A) lack of incentive voters have to become well-informed about candidates and issues because their vote is unlikely to affect the outcome of an election.
• B) fact that most people choose to become just as well-informed when making choices as consumers as they do when making choices as voters.
• C) lack of rational analysis on the part of voters when they choose not to become informed about candidates and issues even though this knowledge would produce great personal benefit to them.
• D) problem of not enough information being supplied to voters because politicians are not spending enough on campaign adds to inform voters of their positions on issues.

---

Definitions:

Gross Margin

The difference between revenue and cost of goods sold divided by revenue, expressed as a percentage, indicating the percentage of sales revenue that turns into profit.

Shareholder Wealth

The overall value that shareholders gain from their investment in a company, often measured by stock price appreciation and dividends received.

Free Cash Flows

The amount of cash a company generates after accounting for cash outflows to support operations and maintain its capital assets.

Sole Proprietorship

A business owned by one individual.