question
The ceteris paribus assumption is important in economics because
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it would be impossible to relate the effects of changes in one variable on another without holding some variables constant.
question
"To be useful, a model must be completely realistic." Evaluate.
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To be useful, a model must capture key real-world elements but cannot account for every detail of the real world. The model should capture the essential relationships that enable us to analyze the problem with which we are concerned. A model is useful so long as it sheds light on the central forces at work.
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A possible rational reason why older people, on average, show less interest in learning how to use new technologies is because
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they have fewer years to gain a return from learning how to use new technologies.
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What assumption about human motivation is made in economics? Explain.
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Economists assume that people act as if motivated by self-interest. People respond predictably to opportunities for gain. That is, people look out for their own self-interest and do so in a rational manner.
question
According to economists, when two people make exactly the opposite decision
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each person evaluates the situation according to his/her individual self-interest.
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In economics
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resources are limited but wants are unlimited.
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Given a linear curve, the value on the y-axis changes from 100 to 120 when the value on the x-axis changes from 20 to 10, then the slope of that curve is
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-2.
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Microeconomics examines the
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decision making undertaken by individual households.
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Which of the following statements concerning the distinction between positive and normative economics is TRUE?
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Positive statements are concerned with what is, while normative statements are concerned with what someone thinks should be.
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Which of the following is an example of a positive economic statement?
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If payroll taxes are raised, then the Social Security crisis will be resolved.
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Macroeconomics might study which of the following?
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the causes of domestic unemployment
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If psychological limitations and other complications cause people to be unable to examine and think through every possible choice available to them and rely instead on rules of thumb, then these individuals exhibit
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bounded rationality.
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A relationship between two variables in which one variable increases at the same time as the other decreases is called
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inverse.
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Economics
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All of these are correct.
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Rational self-interest means
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pursuing what makes you better off.
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Positive statements can contain
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facts and predictions.
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Which of the following would likely be considered as a topic of microeconomics?
answer
the price of apples
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