From a psychological point of view, could we talk ourselves out of a recession simply by having business and government leaders express optimistic statements?
What will be an ideal response?
Probably not because talk has to be followed up by actions. However, if investors and consumers have a general feeling that economic conditions are not so bad or are going to get better, it could encourage consumption and investment spending.
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Pursuing comparative advantage means
A) adding up the plusses and minuses after a transaction. B) doing it to the other person first. C) making equal, fair exchanges for equally valued goods or services. D) sacrificing something less valuable for the sake of something more valuable. E) seeking relative status rather than absolute welfare.
Which of the following models explains why high unemployment has persisted in some European countries for such long periods—periods too long to be the result of fixed money-wage contracts or backward-looking price expectations?
a. Insider outsider models b. Efficiency wage models c. Sticky price models d. IS-LM models