Exam 1: Reasoning With Economics: Models and Information

_____ is an online venue where businesses and individuals can hedge their uncertainty about whether legislation that affects them will be enacted.

Economists often take their first shot at a business problem by assuming that relevant information is available:

It has been observed that people surveyed shortly after major air crashes estimate higher probabilities that a given flight will crash than people surveyed during intervals without any.The error in reasoning observed in this experiment results from:

Which of the following is true of a human mind?

A model of choice in economics starts by assuming that:

Rationality is a normative concept.

Assume that a cargo ship carrying the merchandise of a cloth merchant has been wrecked.Such a setback will be accounted as the merchant's:

The assumption of rationality in economics implies that:

The human mind's abilities to reason and imagine are facilitated by the information it can collect from trustworthy sources, rather than by facts and experiences it can recall from memory.

Advertising reduces the cost of obtaining a commodity by saving the time spent searching for price quotes and other information related to this commodity.

While purchasing _____ an individual whose cost of time is low will visit a larger number of dealers compared to the individual whose cost of time is high.

What is the basic assumption underlying the model of choice?

How is economic research similar to the research in other branches of science?

The logical (and sometimes illogical) shortcuts that people derive from experience which economize on their mental capabilities are called:

The different methods by which the sellers inform their potential buyers about the product is called: