In traditional economic models, homo economicus refers to a decision maker who:
A. searches for relevant facts in a potentially haphazard way and who quits once his or her understanding has reached a certain threshold.
B. makes frequent departures from rational choice and instead relies upon judgmental heuristics, or rules of thumb, to guide decisions.
C. lacks impulse control and, as a result, may experience regret.
D. is narrowly self-interested, well-informed, highly disciplined, and cognitively capable enough to solve optimization problems.
Answer: D
You might also like to view...
Fiscal policy would be more effective if
A. potential income was unknown. B. the government could change taxes and expenditures rapidly. C. the size of the government debt didn't matter. D. crowding out occurred more often.
Suppose goods A and B are substitutes for each other. We would expect the cross-price elasticity between these two goods to be
a. positive. b. negative. c. either positive or negative. It depends whether A and B are normal goods or inferior goods. d. either positive or negative. It depends whether the current price level is on the elastic or inelastic portion of the demand curve.
Figure 4-25
Refer to . Producer surplus before the tax was levied is represented by area
a.
A.
b.
A + B + C.
c.
D + E + F.
d.
F.
What does a balance of trade deficit imply?
a. exports of goods and services exceed imports of goods and services b. imports of goods and services exceed exports of goods and services c. investment income received from abroad exceeds investment income paid to foreigners d. investment income paid to foreigners exceeds investment income received from abroad e. investment by foreigners exceeds domestic investment in other countries