Answer to Question #296550 in Microeconomics for jay

Question

A recycling program provides a machine that accepts glass and plastic bottles and gives recyclers coupons that can be redeemed inside the store where the machine is located. The machine is used less than the recycling program organizers had hoped. How would an economist explain this?

Group of answer choices

Despite the posted notice, people do not trust that the coupons will, in fact, be accepted in the store, at their face value, the same as cash.

Although the machine performs an automated exchange of one thing for another, it is not really an economic transaction, and therefore people are reluctant to participate.

The time required to use the machine and the requirement that the coupons be redeemed at that store together add up to too high an opportunity cost.

People understand the benefits of recycling glass and plastic bottles.

People like recycling glass and plastic bottles.

Answer 1

The machine performs less than expected because there is an exchange of the recycling materials with coupons that can be redeemed later rather than cash which is utilized instantly. The recycling exercise, therefore, attracts fewer people than expected.