A trade-off between aggregate output and inflation
A) is theoretically possible, but has never been observed in practice.
B) may exist in the short run, but not in the long run.
C) may exist in the long run, but not in the short run.
D) exists in both the short run and the long run.
B
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Each person goes about her daily business seeking to maximize her own self interests. In doing so, she contributes to the welfare of society at large. This is the idea underlying Adam Smith's "invisible hand."
Indicate whether the statement is true or false
Duane owns his own real estate company. The Bureau of Labor Statistics counts Duane as
a. unemployed and in the labor force. b. unemployed and not in the labor force. c. employed and in the labor force. d. employed and not in the labor force.
The first country to require standardized cost-effectiveness analysis before a pharmaceutical drug would be approved for distribution and reimbursement was:
a. France. b. the UK. c. Norway. d. Australia. e. Sweden.
Heuristics:
A. are rules of thumb that generate decisions that generally maximize net benefits. B. take a long time to develop and are therefore avoided by rational decision makers. C. are shortcuts that save time and energy in decision making. D. always waste mental resources by leading people to suboptimal outcomes.