Luanne's Parents Are in the Process of Getting a Divorce

question 23

Multiple Choice

Luanne's parents are in the process of getting a divorce. She is so distracted and upset by the situation that she sometimes has trouble paying attention in class,and her performance on assignments and quizzes has slipped a bit. She worries that her teachers might think she simply doesn't care about her schoolwork,when in fact she cares a great deal about how she well she does in school. Luanne is showing:

• A)Induction.
• B)Recursive thinking.
• C)Prosocial reasoning.
• D)An attributional bias.

---

Definitions:

Spending Multiplier

A concept in economics that quantifies the impact of a change in fiscal policy on the overall economy, indicating how an initial change in spending leads to a larger change in income and output.

Potential Output

The maximum amount of goods and services an economy can produce when it uses its resources fully and efficiently, without causing inflation.

Net Taxes

The total taxes paid to the government minus transfer payments and subsidies received from the government.

Aggregate Demand

The total quantity of goods and services demanded across all levels of an economy at a given price level and in a given time period.