Consider the example of an individual trying to decide whether to commute to work by car or by bus

Economics Dec 09, 2020

Consider the example of an individual trying to decide whether to commute to work by car or by bus.

This example can be used to illustrate which of the following concepts? (Explain your answer choice.)

a. Free riding behavior

b. The belief that individual actions do not influence aggregate outcome

c. That many people do not care about the environment

d. Choices a and b

Expert Solution

The correct answer to this question is d. Choices a and b. The choice exhibits the individual's thoughts about obtaining a free ride (assuming that the bus is free). Also, it inforces the fact that individual actions do not influence the aggregate outcome since they make the decisions that are best for them.

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