How have insights from the field of psychology influenced the thinking of economists in recent years?
Insights from psychology have led some economists to question the assumption of rationality that pervades mainstream economic models. Evidence from experimental economics does raise serious questions about the rationality assumption. For example, most people may be concerned with the fairness of outcomes, in addition to the impact of those outcomes on their own well-being. An open question is: If the rationality assumption does not really reflect the behavior of real economic actors, then how important is it that we model other motivations, such as the desire for fairness, the tendency to procrastinate, overconfidence, etc.?
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Sally is an average shopper, with average income. When she is in the store she buys a few items which cost more than $20, several items which cost between $5 and $20, and many items which cost less than $1 . The price elasticity of Sally's demand for these goods most likely ____
a. increases as the price decreases b. decreases as the price decreases c. increases as the price increases d. decreases as the price increases e. remains constant over all price ranges
One of the most important changes in the composition of the labor force in the United States has been
a. the major increase in the number of women who work outside the home. b. the drop in the number of men who only work part-time. c. the steady decline in the number of women who work. d. the increase in the ratio of male workers to female workers. e. the major increase in the number of men who work away from the home or farm.
Refer to the accompanying figure, which shows the annual domestic supply and annual domestic demand for jeans in a small country.
If the world price of a pair of jeans is $40, and this country is open to trade with the rest of the world, then it will ________ pairs of jeans each year.
A. export 4,000 B. export 24,000 C. import 28,000 D. import 24,000
Production is the process by which
A. resources are allocated and distributed. B. products are used by consumers. C. resources are transformed into useful forms. D. products are converted into capital.