4
practice testMultiple Choice

Practice Test

Question 4 • Economics and Personal Finance

Which best describes the effect negative incentives have on a certain course of action?

Answer
A
They make the action less likely.
B
They make the action impossible.
C
They make the action less profitable.
D
They make the action difficult.

Explanation

A negative incentive is a penalty or disadvantage associated with an action. It discourages people from choosing that action, so it makes the action less likely. It does not necessarily make the action impossible or difficult.

AI-written and checked against the verified answer.

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