Entrepreneurs have the incentive to:
A) follow the orders of the central planner.
B) move resources into those industries with the lowest marginal costs.
C) minimize marginal costs.
D) move resources out of low-value industries and into high-value industries.

Question

Quizplus · Accepted Answer

Entrepreneurs are driven by profit, and in order to maximize profit, they will naturally move resources out of low-value industries and into high-value industries. This is because the high-value industries provide a greater return on investment and are therefore more profitable. By minimizing costs and maximizing profits, entrepreneurs can achieve success in their ventures. Following the orders of a central planner or solely focusing on minimizing marginal costs may not necessarily lead to the most profitable outcome for the entrepreneur. Moving resources into industries with the lowest marginal cost may not always be the most profitable either, as low cost does not necessarily equate to high value or demand.

Entrepreneurs Have the Incentive To