Economics Promotes Which of the Following as the Way to Make

question 209

Multiple Choice

Economics promotes which of the following as the way to make the best decision?

• A)Continue an enjoyable activity as long as you do not have to pay for it.
• B)Continue an enjoyable activity until it is no longer enjoyable.
• C)Continue an enjoyable activity until you cannot afford to pursue it.
• D)Continue an enjoyable activity up to the point where its marginal benefit equals its marginal cost.

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Definitions:

Externalities

Economic side effects or by-products that affect an uninvolved third party; can be positive or negative.

Pollution Abatement

Measures and processes undertaken to reduce, control, or eliminate pollution from various sources.

Optimal Amount

The quantity of a good or service that yields the highest utility or benefits under specific conditions.

Moral Hazard

A situation in economics where one party is more likely to take risks because another party bears the costs of those risks.