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The Exchange Rate Between the Dollar and the Swiss Franc

question 171

Multiple Choice

The exchange rate between the dollar and the Swiss franc is $1 = 8 francs,and the price of a Swiss army knife is $5.If the exchange rate changes to $1 = 4 francs,the dollar price of the Swiss army knife ____ to _______.


Definitions:

Self-Consistency Dissonance

The discomfort experienced when one’s actions are not consistent with one’s self-image or personal values.

Festinger

An American social psychologist best known for Cognitive Dissonance Theory, which explains the discomfort that arises from holding two conflicting beliefs simultaneously.

Cognitive Dissonance

The psychological discomfort experienced when holding two or more conflicting beliefs, values, or attitudes, leading to changes in belief or behavior to reduce the discomfort.

Elliot Aronson

An influential psychologist known for his research on social influence, group dynamics, and the theory of cognitive dissonance.

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