Which of the following demonstrates how people respond to incentives to make themselves better off?
A)More students major in economics when they hear that salaries for economists are rising.
B)Students are assigned dorm rooms through a lottery system.
C)Students are encouraged to donate blood because it is the right thing to do.
D)Students and faculty are encouraged to wear college apparel to support the college athletic teams.

Question

Quizplus · Accepted Answer

The fact that more students major in economics when they hear that salaries for economists are rising demonstrates how people respond to incentives to make themselves better off. The incentive of a higher salary motivates students to choose a major they perceive will lead to a greater financial outcome.

Which of the Following Demonstrates How People Respond to Incentives