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A beneficial fee structure for consumers designed to encourage a behavior is referred to as a:

A) Positive tariff
B) Behavior-based cost
C) Incentive pricing
D) Behavioral levy

1 Answer

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Final answer:

The fee structure designed to encourage certain consumer behavior is known as Incentive pricing. It's a part of behavioral economics, aiming to nudge consumers towards making better choices through subtle changes in policy and design.

Step-by-step explanation:

The fee structure for consumers that is designed to encourage behavior is known as C) Incentive pricing. Behavioral economics, which integrates insights from psychology into economic decision-making, uses this concept to nudge consumers toward more rational behavior. For instance, automating retirement savings enrollments in companies can significantly increase the number of employees who start saving for retirement, which is crucial for their future financial stability. These nudges are designed to help people make better choices without the need for strict regulations.

User Ankit Jaiswal
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