You and other college students are deciding whether to major in music or engineering. You learn that there is a shortage of engineers, making it easy for engineering graduates to find employment, while there is a glut of musicians for whom finding a job is difficult. ● As a result, you and many other college students decide to major in engineering. Which economic principle does this illustrate? a) Markets tend to move towards equilibrium as individuals respond to incentives b) Government intervention can improve efficiency when there is a market failure c) Changes in incentives are unlikely to change the decisions people make. d) Individuals do not normally take into account the decisions of other individuals.
You and other college students are deciding whether to major in music or engineering. You learn that there is a shortage of engineers, making it easy for engineering graduates to find employment, while there is a glut of musicians for whom finding a job is difficult. ● As a result, you and many other college students decide to major in engineering. Which economic principle does this illustrate? a) Markets tend to move towards equilibrium as individuals respond to incentives b) Government intervention can improve efficiency when there is a market failure c) Changes in incentives are unlikely to change the decisions people make. d) Individuals do not normally take into account the decisions of other individuals.
Chapter1: Introducing The Economic Way Of Thinking
Section: Chapter Questions
Problem 4SQ
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ISBN:
9781337617383
Author:
Roger A. Arnold
Publisher:
Cengage Learning