A policy's direct effect includes___________.
A) The effects of a policy on third parties
B) Changes in market prices resulting from a policy
C) Changes in behavior in people directly affected by policy
D) Includes all of the effects from a policy including the spillovers

Question

Quizplus · Accepted Answer

A policy's direct effect refers to changes in the behavior of those individuals or groups directly affected by the policy. This does not include the effects on third parties (answered in choice A) or changes in market prices (choice B). The direct effect does not include spillover effects (Choice D).

A Policy's Direct Effect Includes___________