Question

Tasha's mother rewards her with $5 for every "A" she gets on a report card. Which economic concept is this an example of?

Answer 1

Tasha's mother rewards her with $5 for every "A" she gets on a report card. Which economic concept is this an example of? Positive incentive. Tasha is receiving the incentive of money, everytime she gets an A on a report card. This is known as a positive incentive because it is pushing Tasha to work hard for something that in return, receives a positive benefit for it.

Answer 2

This is an instance of an extrinsic reward carried out through an incentive plan, to reinforce and support acceptable behavior. In business, an example of this would be increasing a worker’s wages according to a one’s productivity and output, via a pay rise or a bonus.