Which of the following is best explained with behavioral economics rather than traditional economics?
a. How people purchase apples from a grocery store
b. How people make tradeoffs between labor and leisure
c. How firms choose prices to maximize profits
d. How people tend to be overconfident in certain situations
d
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An increase in the interest rates in a country:
A) reduces net exports. B) does not affect net exports. C) increases net exports. D) results in a an outflow of capital from the country.
The great failure of activist fiscal policy in the 1960s was its
A) timidity in the face of persistent stagnation. B) over-reliance on tax cuts to the exclusion of government spending programs. C) delay in reversing course as the economy became overstimulated. D) limited role as an accommodator of an activist monetary policy.
The unemployment rate that is typically reported in the media is ________
A) based on a survey from 150,000 business establishments on weekly earnings, number of workers and hours worked B) computed every three months C) based on a survey of 60,000 households D) reported by the Treasury Department E) none of the above
Moving downward on a downward sloping linear demand curve, the absolute value of the price elasticity of demand
A) is constant. B) increases continuously. C) decreases continuously. D) may either increase or decrease.