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Unformatted text preview: relaxation (immediate benefit, less stress upon return), build relationships, fun Costs: monetary cost (gas, food, place to stay, entertainment) opportunity cost – value of what you might give up (ex. Party in chapel hill, football game, studying, etc.) Once you are there, you are debating whether to stay an additional day. Does your analysis change? 3. The Incentive Principle states that a person is more likely to take an action if the benefit of the action rises, and less likely to take an action if the cost of the action rises. Suppose that you learned last week that “Eating Animals” (the Summer Reading Program book) will also be a required reading for your English course. Are you more or less likely to read the book? More likely because you now have a bigger incentive to read it. Is this an application of the Incentive Principle? Why or why not? Yes. Yada yada yada....
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- Fall '07
- Economics, The Yada Yada, Wrightsville Beach, Connor Beach