Question

most of economics can be summarized in four words:
a. suppliers control the market
b. advertising always increases sales
c. high demand lowers prices
d. people respond to incentives

Explanation:

• Option A is incorrect because markets are typically influenced by both suppliers and demanders, not just suppliers.
• Option B is incorrect as advertising does not always increase sales; its effectiveness depends on multiple factors like audience, message, and market conditions.
• Option C is incorrect because high demand usually raises prices (per the law of demand and supply), not lowers them.
• Option D is a core principle of economics: incentives (financial or non-financial) drive the decisions of consumers, producers, and other economic actors, which underpins most economic analysis.

Answer:

D. People respond to incentives