In economics, decision makers make decisions by thinking at the margin. Thinking at the margin requires recognizing the need to make decisions by evaluating the costs and benefits of marginal changes. It means that a decision maker should compare his/her action’ marginal benefit and marginal cost. Any action should be undertaken only if the benefit is greater than the cost. If people make choices by comparing cost and benefits, then their decisions may be altered by altering the cost or benefits of their actions. People do respond to positive and negative incentives. When there is a significant increase in the price of gasoline, for instance, demand for public transportation and the demand for smaller, more fuel-efficient cars increase.

As it can be understood from the information given, the correct answer is “E”.