Contrary to behavior that would be required to eliminate output gaps, many firms in the economy:
A. intentionally set prices below equilibrium prices in order to create shortages.
B. adjust their prices only periodically.
C. only change the amount of output they produce in the long run, not in the short run.
D. have fully-flexible prices that change constantly.
Answer: B
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According to the text, one important economic application of the anchoring and adjustment bias is
A. in estimating the failure rates of complex projects. B. to evaluate consumer behavior with regard to luxury spending. C. to increase productivity in volunteer organizations. D. to estimate production costs of simple operations.
The 2008-2009 deficit stimulus spending by the federal government is an example of expansionary sound finance.
Answer the following statement true (T) or false (F)
Human resources that perform the functions of organizing, managing, and assembling the other factors of production are called
A) physical capital. B) venture capital. C) entrepreneurs. D) productive capital.
What is a balance-of-payments surplus?
What will be an ideal response?