If individuals behave irrationally in some circumstances, why do economists typically assume that they behave rationally?
a. The assumption of rationality allows economists to make powerful statements that apply the majority of the time.
b. The assumption of rationality was used before psychologists discovered ways in which individuals behave irrationally.
c. The assumption of rationality is
used because economists do not understand principles of psychology.
d. The assumption of rationality has yet to be refuted with scientific evidence.
a
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A rightward shift of the investment demand curve will
A. decrease the real rate of interest. B. shift the investment schedule downward. C. decrease the quantity of investment. D. shift the investment schedule upward.
The table above gives the production possibilities frontier for two countries, Anaconda and Bear. The opportunity cost of moving from ________ is greater for ________
A) point E to point D; Bear B) point A to point B; Anaconda C) point B to point A; Bear D) point D to point E; Bear E) any point to any other point; Bear
The first phase of antitrust policy in the U.S. began with the passage of the Sherman Antitrust Act in 1890 . To judge a firm's action, the courts in this period used:
a. a per se rule. b. a rule of reason. c. a rule of thumb. d. rules of order. e. strict enforcement rule.
If the marginal propensity to save (MPS) is 0.25, the value of the spending multiplier is:
A. 1. B. 2. C. 4. D. 9.