Which of the Following Is Good Evidence Against the Classical

question 57

Multiple Choice

Which of the following is good evidence against the classical view of Say's law?

• A) Investment does not always rise as interest rates fall.
• B) Consumption falls by the amount that saving increases.
• C) Exports are usually greater than imports.
• D) People save more at higher interest rates than lower interest rates.
• E) none of the above

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Definitions:

Representativeness Heuristic

A cognitive shortcut that involves making judgments based on how well something matches or represents a particular prototype.

Overconfidence

The tendency to be more confident in one's own abilities or outcomes than is objectively justified.

Availability Heuristic

A mental shortcut that relies on immediate examples that come to a person’s mind when evaluating a specific topic, concept, method, or decision.

Representativeness Heuristic

A cognitive shortcut used in decision-making that involves judging the likelihood of an event based on how closely it matches a prototype or stereotype.