The Use of Economic Models, Like the Cost-Benefit Principle, Means

question 130

Multiple Choice

The use of economic models, like the cost-benefit principle, means economists believe that:

• A) this is exactly how people choose between alternatives.
• B) this is a reasonable abstraction of how people choose between alternatives.
• C) those who explicitly make decisions this way are smarter.
• D) with enough education, all people will start to explicitly make decisions this way.

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Definitions:

Objective

Something that one's efforts or actions are intended to attain or accomplish; purpose; goal; target.

Measurable Performance

Refers to the ability to quantify or assess the effectiveness or output of an employee, project, or organization.

Skill-based Pay Plan

A compensation strategy where employees are paid based on the skills and knowledge they possess, rather than their job position or title.

Productivity

The efficacy and efficiency with which input resources (such as time, labor, and materials) are converted into outputs, such as goods or services.