Public Policy

question 4

Multiple Choice

Public policy:

• A) can be precisely defined
• B) is frequently used by the courts as a reason to invalidate contracts
• C) is protections from that which violates any established interest of society
• D) all of the above

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Definitions:

Labor-Leisure Tradeoff

The balance individuals must find between time spent working, which earns income, and time spent enjoying leisure activities.

Substitution Effect

The change in consumption resulting from a change in the relative prices of goods, prompting consumers to replace more expensive items with less costly alternatives.

Income Effect

The shift in income for an individual or the economy, and its influence on the demand for a specific good or service.

Wages Increase

The act or occurrence of raising the amount of money that workers are paid for their labor.