Suppose That a Particular Policy Would Result in a $100

question 31

Essay

Suppose that a particular policy would result in a $100 gain for Gwen but a $20 loss for Sabrina.Everyone else in the economy remains the same.Is this policy change in the public interest according to the potential compensation criterion? Explain and justify your answer.

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Definitions:

Fixed Cost

Expenses that do not change with the level of production or sales in the short term, such as rent, salaries, and insurance premiums.

Gross Profit

Money available to cover the costs of marketing the product, operating the business, and profit.

Merchandise

Goods or products that are purchased, sold, or traded, often in the context of retail.

Emotional Intelligence

The combination of four abilities: (a) your ability to perceive other’s emotions; (b) your ability to identify your emotions, (c) your ability to understand what’s causing your emotion, and (d) your ability to manage your emotions.