Exam 1: Reasoning With Economics: Models and Information

How does fairness differ from equality?

Economists use the phrase, "dollar bills left on the sidewalk" for describing systematically missed opportunities.

Identify and define the different types of constraints individuals face while making different choices.

How do constraints affect our choices?

Why is information sometimes considered as a good?

Researchers who make judgements in their experiments based on what is salient rather than on actual probabilities err by using a representativeness heuristic.

Which of the following is an example of a physical constraint?

A car owner who has agreed to sell his old car to a buyer at a contracted price will be unable to accept the price offered by other prospective buyers due to the _____ constraint.

Which of the following individuals will undertake extensive research before making their choice?

When an economy's limited resources are moved into the production of one commodity, the production of a valuable alternative has to be foregone.This most valuable alternative lost is referred to as:

Which of the following products should be sold face-to-face rather than by mass advertising?

When an individual is unable to alter or undo a past decision he/she incurs an opportunity cost.

An elimination heuristic makes the choice on the basis of all the categories in which the events differ.

Economic models simplify reality and help us to better understand important aspects of it.

Jane regularly sends funds to organizations seeking to save endangered animal species.This is an example of:

What is the difference between sunk costs and marginal costs?

Even when racetrack bettors know very little about the characteristics of horses, why are their aggregate bets often good estimates of the true probabilities of winning, placing, and showing?

Which of the following is an example of money left on the sidewalk?

Which of the following can act as a substitute for information?

The different rights and responsibilities which owners, workers, and managers have in different forms of business are referred to as contractual constraints.