Asked by Gantt

Which of the following economic actions demonstrates a negative incentive

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Answered by GPT-4o mini
A negative incentive is an action or policy that discourages a certain behavior by imposing a cost or penalty. Here are some examples of economic actions that demonstrate negative incentives:

1. **Taxes on sugary drinks**: By imposing a tax, consumers are discouraged from purchasing these drinks due to the increased price.

2. **Fines for littering**: This discourages people from littering by imposing a financial penalty if they do so.

3. **Higher insurance premiums for smokers**: This incentivizes individuals to quit smoking by making it more expensive for them to maintain insurance.

4. **Increase in traffic fines**: Higher fines for speeding or other traffic violations discourage unsafe driving behavior.

If you have specific actions in mind, please list them, and I can help identify which one demonstrates a negative incentive.

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