Stanley Jevons, an economist in the nineteenth century, noted a high correlation between economic prosperity and sunspots. Based on this observation he developed a "sunspot theory" of how the economy operated. We now know that Jevons
A) committed the ceteris paribus error.
B) committed the fallacy of composition.
C) was confusing causality.
D) showed good reasoning for the nineteenth but not the twentieth century
Answer: C) was confusing causality.
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If the price elasticity of demand for a good is greater than one, then the demand for that good is:
A. unit elastic. B. perfectly elastic. C. inelastic. D. elastic.
The total number of workers in two different countries are equal. However, each worker in Country A is three times more productive than a worker in Country B. Which of the following is true in this case?
A) The capital stock in Country B is three times more than the capital stock in Country A. B) The total efficiency units of labor in Country A is three times more than the total efficiency units of labor in Country B. C) The total efficiency units of labor in Country A is one-third of the total efficiency units of labor in Country B. D) The total efficiency units of labor in Country B is six times more than the total efficiency units of labor in Country B.
In 1995 ________, which was established in 1948, was replaced by ________
A) NAFTA; the Smoot-Hawley Tariff B) the WTO; NAFTA C) the GATT; the WTO D) the Smoot-Hawley Tariff; the GATT
Managers will use ________ probabilities to estimate the likelihood of a successful launch of a new brand of peanut butter.
A) relative B) objective C) known D) subjective