Which of the Following Is a True Statement About the Economic

question 229

Multiple Choice

Which of the following is a true statement about the economic assumption of rationality?

• A) Individuals who are rational necessarily ignore the interests of others.
• B) Individuals generally act as though they are rational.
• C) Individual behavior may be irrational but group behavior is always rational.
• D) People make decisions as if they are omniscient.

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Definitions:

Internal Validity

refers to the extent to which a study can demonstrate a clear cause-and-effect relationship between variables, unconfounded by extraneous factors.

Causal Relationships

Connections between variables where a change in one variable directly influences a change in another.

External Validity

The extent to which the findings of a study can be generalized to other settings, populations, or time periods.

Laboratory Experiments

Experiments conducted in a controlled environment where variables can be manipulated and measured precisely.