How do rational behavior and self-interest relate?
a. Self-interest rarely motivates people to use rational behavior to make decisions.
b. Self-interest is rational when it is selfless, but not selfish.
c. Self-interest usually motivates people to use rational behavior to make decisions.
d. Self-interest is rational when it is selfish, but not when it is selfless.
c. Self-interest usually motivates people to use rational behavior to make decisions.
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The following question is an example of microeconomic analysis, "What determines the price of gasoline in a particular city or town?"
Indicate whether the statement is true or false
Assume the central bank pursues contractionary monetary policy. What is the first round effect on the value of the domestic currency, if there is high mobility in the international capital markets?
a. The value of the currency rises. b. The value of the currency falls. c. The value of the currency is unaffected. d. The change in the value of the currency is ambiguous.