The Rules That Limit Self-Dealing Through the Related Party Provisions

question 53

Multiple Choice

The rules that limit self-dealing through the related party provisions is a result of the

• A)Ability to Pay Concept.
• B)Administrative Convenience Concept.
• C)Arm's-Length Transaction Concept.
• D)Capital Recovery Concept.
• E)Pay-as-You-Go Concept.

---

Definitions:

Neoclassical Assumption

Underlying principles of neoclassical economics that include rationality, individuals maximizing utility, firms maximizing profits, and markets tending toward equilibrium.

Rational Behavior

Human behavior based on comparison of marginal costs and marginal benefits; behavior designed to maximize total utility. See rational.

Cognitive Biases

Systematic patterns of deviation from norm or rationality in judgment, whereby inferences about other people and situations may be drawn in an illogical fashion.

Behavioral Economists

Experts in a field of economics that combines insights from psychology to understand how people make economic decisions.