Which of the following terms is used to describe a situation in which the price of an asset rises above what appears to be its fundamental value?

Unless you accept his 'final offer' your opponent threatens to scrap the whole deal:

a. His threat is more believable if both parties would be harmed by scrapping the deal b. His threat is more believable if he has better outside options c. His threat is more believable if only he is hurt from the deal falling through d. His threat is more believable if he has balked at this course of action in the past

A major problem that may occur with models that predict the values of economic variables in the future is that

a. researchers are pessimistic about the future. b. the model may fail to acknowledge that economic actors will change their behavior in response to changing situations. c. the model may make predictions that conflict with widely held opinions. d. no one cares about these predictions.

Adam Smith, in his book, The Wealth of Nations, advocated:

a. socialism. b. an economy guided by an "invisible hand." c. government control of the "invisible hand." d. the adoption of mercantilism.

The business cycle consists of four phases. In sequence, they are prosperity,

a. recovery, recession, and downturn b. recovery, downturn, and recession c. upturn, downturn, and recession d. downturn, recovery, and recession e. downturn, recession, and recovery