Behavioral economics deals with
A) the assumption that people are always selfish.
B) bounded rationality.
C) unbounded willpower.
D) only theories without justification from empirical evidence.
B
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The type of credit insurance that landed AIG into trouble in 2008 is called
A) insurance rate swaps. B) monoline insurance. C) default insurance. D) credit default swaps.
In general, the Fed has not embraced a fixed-growth-rate monetary policy because: a. its adoption would lead to a decrease in the employment rate in the U.S. economy. b. no influential economists have come out in favor of it
c. the Fed has to report to Congress, and Congress is not in favor of it. d. the Fed prefers active fiscal policy. e. they believe the economy is too complex to make such a policy work consistently.