There are several competing models of the business cycle because
A) none currently captures all facets of the business cycle.
B) they are all rooted in different philosophical traditions.
C) different shocks need different models.
D) they depend on the type of policy that is adopted.
A
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Suppose a consumer has an income of $800 per month and that she spends her entire income each month on beer and bratwurst. The price of a pint of beer is $5, and the price of a bratwurst is $4 . Which of the following combinations of beers and bratwursts represents a point that would lie to the interior of the consumer's budget constraint?
a. 160 beers and 200 bratwursts b. 40 beers and 50 bratwursts c. 80 beers and 100 bratwursts d. 160 beers and 0 bratwursts
The elimination of import restrictions will
A. Alter the mix of output from export industries to import-competing industries. B. Redistribute income from import-competing industries to export industries. C. Redistribute income from domestic to foreign producers. D. Alter the mix of output from export industries toward domestic industries.
The farther into the future a stock dividend is expected to be paid, the less the stock price will be discounted.
Answer the following statement true (T) or false (F)
The following are major observations made by behavioral economists regarding human behavior, except:
A. Workers tend to spend and consume too much in the present, thus not saving enough for retirement B. People tend to stick with the default option when faced with various alternatives C. People behave in ways that seem irrational at first glance, but are really rational D. People often intentionally act in irrational ways