People interpret evidence to confirm beliefs they already hold. This statement is an example of which of the following systematic mistakes that people make?
a. people are overconfident
b. people give too much weight to a small number of vivid observations
c. people are reluctant to change their minds
d. All of the above are correct.
c
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An article in the Wall Street Journal noted the following: Instead of relying on a full-coach, round-trip unrestricted fare of about $2,000 between Cleveland and Los Angeles
Continental [Airlines] since June has offered a $716 unrestricted fare in that market .... Through October, the test resulted in about the same revenue that Continental thinks it would have collected with its higher fare. Source: Scott McCartney, "Airlines Try Cutting Business Fares, Find They Don't Lose Revenue," Wall Street Journal, November 22, 2002. What is the absolute value of the price elasticity of demand on this airline route? A) less than 1 B) approximately 1 C) greater than 1 D) 0
If marginal utility is declining but still positive, total utility is increasing.
Answer the following statement true (T) or false (F)