When building a model, an economist must:
A. adjust for exceptional situations.
B. provide a complete description of reality.
C. make simplifying assumptions.
D. develop a set of behavioral equations.
Answer: C
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The bowed-out-from-the-origin shape of the production possibilities curve occurs because resources are
a. equally well-suited to production of both goods b. not being used efficiently c. not always of equal quality and some are better suited to the production of one type of good than others d. increasing as more of one good is produced e. of an increasingly inferior quality
Affirmative action laws require employers to hire specified numbers of minorities
a. True b. False Indicate whether the statement is true or false
c. They save consumers time and mental processing power.
a. irrational b. lack of c. marginal d. total
Based on the graph showing the effective federal funds rate, the downturn in interest rates after the 2001 recession lasted ______.
a. a shorter time than most downturns
b. a longer time than most downturns
c. about the same time as most downturns
d. five years longer than any previous downturn