In Which of the Following Types of Decision-Making Approaches Do

question 61

Multiple Choice

In which of the following types of decision-making approaches do consumers tend to search diligently for information that will help them reach a satisfactory decision?

• A) Rational decision making
• B) Limited decision making
• C) Extended decision making
• D) Habitual decision making
• E) Routine decision making

---

Definitions:

Coase Theorem

An economic theory proposing that if trade in an externality is possible and there are no transaction costs, parties can negotiate solutions to conflicts that lead to an efficient outcome regardless of the initial allocation of property rights.

Pollution Tax

A tax levied on the amount of pollution emitted by firms to incentivize reduction in environmental harm.

Tax Revenue

The income that is gained by governments through taxation, which is used to fund public services and goods.

External Costs

Costs that fall on third parties who are not directly involved in a transaction or economic activity.