New Classical Economists Build Their Theories Upon

question 32

Multiple Choice

New classical economists build their theories upon

• A) adaptive expectations.
• B) inflexible wages and prices.
• C) rational expectations.
• D) the assumption that it takes a long time for markets to achieve equilibrium values.

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Definitions:

Illusory Correlations

The cognitive bias of perceiving a relationship between variables (typically people, events, or behaviors) even when no such relationship exists.

Cognitive Maps

Mental representations of physical locations, allowing an individual to visualize paths or navigate spaces they have experienced.

Algorithms

Step-by-step procedures or formulas for solving problems or completing tasks, often used in computing and mathematical problem-solving.

Base-Rate Information

Statistical information about the general frequency of an event or characteristic within a relevant population.