In a Particular Year,if the Price Level Rises by 4

question 126

Multiple Choice

In a particular year,if the price level rises by 4 percent and the nominal wage of workers rises by 6 percent,we can conclude that the real wage has:

• A)fallen by 2 percent.
• B)fallen by 10 percent.
• C)increased by 2 percent.
• D)increased by 10 percent.
• E)remained constant.

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Definitions:

Outgroup Homogeneity Bias

Outgroup Homogeneity Bias is the tendency to view individuals from outside one’s own group as more similar to each other than those within the group, leading to stereotypical thinking.

Group Attribution Error

The tendency to make broad stereotypical judgments about a group based on the actions of a few individuals within that group.

Ultimate Attribution Error

A bias in which negative behaviors by out-group members are attributed to their character, while similar actions by in-group members are attributed to situational factors.

Law Of Small Numbers

A cognitive bias where people infer broader conclusions from a small set of observations than is statistically warranted.