Which of the Following Statements Is TRUE

question 147

Multiple Choice

Which of the following statements is TRUE?
I. Taxes may reduce consumption by exactly the same amount as government regulations.
II. Taxes typically cost more than government regulations because taxes raise prices whereas regulations simply limit quantity.
III. Command and control policies effectively reduce consumption, but they may not be the lowest cost method for doing so.

• A) I and II only
• B) I and III only
• C) II only
• D) II and III only

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Definitions:

Black Box Influence

The impact of systems or processes whose internal workings are not visible or easily understood by outside observers.

Consumer's Mind

The perceptions, attitudes, memories, and biases that influence how a customer thinks about a product, brand, or experience.

Evoked Set

The group of brands or businesses that come to a customer’s mind when she thinks of a type of product.

Cognitive Dissonance

The mental discomfort experienced by an individual who holds two or more contradictory beliefs, ideas, or values at the same time.