Behavioral economics deals with
A) the assumption that people are always selfish.
B) bounded rationality.
C) unbounded willpower.
D) only theories without justification from empirical evidence.
Answer: B
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Starting from long-run equilibrium, an increase in autonomous investment results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; higher C. lower; higher D. higher; potential
An increase in the number of firms in a market will cause the quantity of a good supplied to increase
Indicate whether the statement is true or false
Government price controls make communication of information between buyers and sellers more effective
a. True b. False Indicate whether the statement is true or false
________ are forces that cause a reduction in a firm's average cost as the scale operation increases in the long run. ________ are forces that cause a firm's average cost to increase as the scale of operation increases in the long run
a. Diseconomies of scale; economies of scale. b. Economies of scale; diseconomies of scale. c. Increasing returns to a factor; decreasing returns to a factor d. Decreasing returns to a factor; increasing returns to a factor