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Author Question: A subsidy is sometimes used by government to correct the problems associated with A) negative ... (Read 312 times)

debasdf

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on: Jun 29, 2018
A subsidy is sometimes used by government to correct the problems associated with
 
  A) negative externalities.
  B) positive externalities.
  C) internal benefits.
  D) external benefits.

Question 2

Explain what economists mean when they apply the rationality assumption.
 
  What will be an ideal response?


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Bsand8

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Reply #1 on: Jun 29, 2018
Answer to Question 1

B

Answer to Question 2

The rationality assumption means that people do not intentionally make themselves worse off. It does not deal with the interior reasoning of a person or the psychology of a person. Instead, rationality applies to the way people actually behave in a world of scarcity.


debasdf

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Reply #2 on: Jun 29, 2018
Thank you


Bsand8

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Reply #3 on: Jun 29, 2018
No problemo


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