Based on your understanding of your roommate's preferences, you predict that he will select the spaghetti for his lunch at the cafeteria, but instead he chooses the gyros. How do you describe this event in terms of economic theory?
A) Your roommate is irrational.
B) Your roommate does not know what is in his own best interests.
C) You roommate does not know his own preferences as well as you do.
D) You constructed a model that made a prediction, and the prediction was refuted.
D
You might also like to view...
Automatic stabilizers refer to
A) changes in the money supply and interest rates that are intended to achieve macroeconomic policy objectives. B) the money supply and interest rates that automatically increase or decrease along with the business cycle. C) changes in federal taxes and purchases that are intended to achieve macroeconomic policy objectives. D) government spending and taxes that automatically increase or decrease along with the business cycle.
What would you expect the market value to be for a four year bond that has a face value of 10,000 and a coupon return of $2000 when the market interest rate is 6%?
A) $14,851.15 B) $6,930.21 C) $13,742.22 D) $18,000.00
A production possibilities curve indicates that when resources are being used efficiently,
a. you can only produce more of one good only if you lower its price. b. you can only produce more of one good only if you produce more of another good. c. you can only produce more of one good only if you produce less of another good. d. it is impossible to expand the total output of goods over time.
Which of the following situations is sufficient to represent current demand for a car?
A. You have plenty of money to buy it, but you can't decide if you want a motorcycle or a car. B. You have enough money to buy it, and you are willing to spend the money on the car. C. You've decided you want a car, and you can possibly borrow the money from a bank. D. You want to buy a motorcycle and a car, and you'll have enough money for both in two years.