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Coercion is best described as inducing action through means of intimidation. This definition captures the essence of coercion, which involves compelling someone to act in a certain way by using threats or force, thus compromising their ability to make a free choice. In situations where coercion is present, the individual does not genuinely consent to the action in question—they are pressured to comply against their will, which detracts from the voluntary nature of a decision.

Understanding the other options provides clarity to why they do not represent coercion. A voluntary agreement to a contract implies that all parties involved have agreed to the terms freely and without any pressure, which is the opposite of coercion. Legal negotiation between parties also signifies a consensual dialogue aimed at reaching an agreement, entirely devoid of intimidation or force. Finally, providing incentives for a desired action is about encouraging behavior through positive reinforcement, thereby respecting individuals' autonomy rather than forcing compliance through intimidation.