The basic postulate of economics indicates that changes in incentives influence
A) the actions of producers but not consumers.
B) the actions of consumers but not producers.
C) the choices of individuals only when they buy and sell goods in the marketplace.
D) the choices of individuals with regard to a wide range of activities, including those generally perceived as social or political.

Question

Quizplus · Accepted Answer

The basic postulate of economics is that changes in incentives influence the choices of individuals, including those that are generally perceived as social or political. This includes both producers and consumers and extends beyond just buying and selling in the marketplace. Therefore, option D is the correct answer.

The Basic Postulate of Economics Indicates That Changes in Incentives