Which of the Following Is Likely to Happen If There

question 142

Multiple Choice

Which of the following is likely to happen if there is an increase in entrepreneurial activity in an economy?

• A) The income per capita in the economy will fall.
• B) The productivity of the economy will increase.
• C) The inflation rate in the economy will decrease.
• D) The exchange rate of its currency in the foreign exchange market will increase.

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Definitions:

Revealed Preferred

A concept in consumer choice theory that preferences can be determined by observing consumer choices under different constraints.

Violates WARP

Refers to a situation where an individual's choice behavior contradicts the Weak Axiom of Revealed Preferences, suggesting inconsistency in their preferences.

Bundle

A combination of goods or services that are sold or consumed together.

Revealed Preferred

Another term for revealed preference, emphasizing the process of deducing preferences by observing actual choices under constraints.