Most economists would strongly agree with the following statement: "Economics, at least micro economics, is a study of incentives."

1. List and explain three different situations where responses by individuals or organizations to incentives lead to an economically efficient or equitable outcome.
2. List and explain three different situations where responses to incentives by individuals or organizations lead to inefficient or inequitable outcomes.If you correctly explained examples are drawn from different portions of the course, e.g., operation of markets, market failures, public spending, resource mobilization, etc. you will earn an additional points for this question.