An incentive is
A) a reward or a penalty that encourages or discourages an action.
B) when people make rational choices by comparing costs and benefits.
C) what you must give up to get something.
D) a choice is made on the margin.
E) a good or service that satisfies wants.
A
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According to the classical model, the income generated by production is
A) always insufficient to purchase all the goods and services produced. B) enough to purchase all the goods and services produced. C) fully spent on savings. D) enough to meet the needs of everyone in society.
(Consider This) According to the Coase theorem:
A. government should levy excise taxes on firms that generate spillover or external costs. B. taxes should be levied such that they change private behavior as little as possible. C. private individuals can often negotiate their own resolution of externality problems, without the need for government intervention. D. private firms should not provide public goods.