Suppose You Are Asked Whether There Are More Psychology or Biology

question 39

Multiple Choice

Suppose you are asked whether there are more psychology or biology majors at your school.Imagine that you estimate the numbers at your school based on the number of people with these majors you personally know.What are you using?

• A) the covariation principle
• B) the fundamental attribution error
• C) the availability heuristic
• D) the actor-observer effect

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Definitions:

Active Fiscal Policy

Government policy that involves altering government spending and taxation to influence the economy.

Short-run Phillips Curve

An economic model depicting an inverse relationship between the rate of unemployment and the rate of inflation in the short-term.

Potential Output

The optimum level of real gross domestic product achievable over a prolonged period without triggering higher inflation.

Expected Inflation Rate

The rate at which the general level of prices for goods and services is rising, and, subsequently, purchasing power is falling, as anticipated by consumers and businesses.