The hypothesis that people are nearly, but not fully rational, cannot possibly fully examine every available choice, and utilize simple rules of thumb in making decisions is known as the
A) irrationality hypothesis.
B) ceteris paribus hypothesis.
C) individual aggregation hypothesis.
D) bounded rationality hypothesis.
Answer: D
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Though Treasury bonds may have little default risk, what type of risk exists when current interest rates are low?
A) price risk B) refinancing risk C) interest-rate risk D) present value risk
Taxes impose a cost on letting land remain idle
Indicate whether the statement is true or false
The price of one country's currency in terms of another's is called
a. the interest rate. b. the inflationary premium. c. the discount rate. d. the exchange rate.
In the private sector where firms compete for profit, if a firm is inefficient, ________. In the public sector, if a government bureau is producing a necessary service and is doing so inefficiently, ________.
A. it does not need to worry about customers; the market will drive it out of business B. the market will drive it out of business; it does not need to worry about customers C. the market will drive it out of business; the market will drive it out of business D. it does not need to worry about customers; it does not need to worry about customers