In behavioral economics, the term salience refers to
A) relevance to the problem being investigated.
B) people only consider information when it is conveyed in a subtle manner.
C) how an experiment is designed.
D) people consider information when it is presented in an "eye grabbing" manner.
D
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Suppose the interest rate is 7 percent. Consider four payment options: Option A: $500 today. Option B: $550 one year from today. Option C: $575 two years from today. Option D: $600 three years from today. Which of the payments has the highest present value today?
a. Option A b. Option B c. Option C d. Option D
Other things the same, a decrease in the price level causes the interest rate to
a. increase, the dollar to appreciate, and net exports to increase. b. increase, the dollar to depreciate, and net exports to decrease. c. decrease, the dollar to depreciate, and net exports to increase. d. decrease, the dollar to appreciate, and net exports to decrease.
Which of the following will cause a leftward shift in the aggregate demand curve?
A. a reduction in government spending B. an increase in taxes C. a reduction in the money supply D. all of these
New Keynesian inflation dynamics can account for sluggish responses of
A. inflation to changes in aggregate supply. B. real Gross Domestic Product (GDP) to changes in aggregate demand. C. real Gross Domestic Product (GDP) to changes in aggregate supply. D. inflation to changes in aggregate demand.