Activists Believe That

question 42

Multiple Choice

Activists believe that

• A) discretionary changes in macroeconomic policy can help smooth the ups and downs of the business cycle.
• B) balancing the federal budget is of primary importance to economic stability.
• C) the economy's self-correcting mechanism, if not stifled by perverse policies, will prevent prolonged periods of high unemployment.
• D) the M1 money supply should be increased at a steady annual rate.

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Definitions:

Planning Fallacy

The tendency to underestimate the time, costs, and risks of future actions while overestimating the benefits, leading to poor planning and time management.

Underestimating

The act of judging something to be of lower quantity, value, or importance than it actually is.

Project

A planned set of interrelated tasks to be executed over a fixed period and within certain costs and other limitations.

Overconfidence

A cognitive bias where an individual's subjective confidence in their judgments and abilities is greater than their objective accuracy.