Two Economists Are Arguing About How to Approach a Problem

question 35

Multiple Choice

Two economists are arguing about how to approach a problem. The first economist says, "Look, I can see in the data that consumption rises when income rises. We need to build a model with an equation that relates the two." The second economist responds, "I can see that is the case, but we have to understand why that is true before we build any equations, and then we will see what the model says about the relationship between the two." What kind of economist is the second one likely to be?

• A) A traditional economist
• B) A behavioral economist
• C) An irrational economist
• D) An engineering economist

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Definitions:

Instinct

Instinct denotes the inherent inclination of a living organism towards a particular complex behavior, which is unlearned and often serves survival and reproductive purposes.

Cognition

The act of obtaining knowledge and insights through the faculties of the mind, personal experiences, and sensory input.

Anxiety

A feeling of worry, nervousness, or unease about something with an uncertain outcome, often reflecting a concern about future events.

Individual Level

Focuses on the behavior, characteristics, and experiences of an individual, as opposed to the dynamics of groups or societal levels.