Microeconomics

Question 1

fallacy of composition

Accepted Answer

incorrect belief that what's true for the indivudal is true for the group

Question 2

fallacy that association is causation

Accepted Answer

incorrect belief that if two variables happen at about the same time, one causes the other

Question 3

sample selection bias

Accepted Answer

using the statistical analysis of a small part of a population to predict the behavior of the entire population

Question 4

faulty ceteris paribus

Accepted Answer

assuming certain variables are constant when they really aren't

Question 5

equally possible conflicting explanations

Accepted Answer

when two or more theories explain measurements equally well

Question 6

income effect

Accepted Answer

____ is the change in quantity demanded of a good or service caused by a change in real income (purchasing power).

Question 7

substitution effect

Accepted Answer

___ is the change in quantity demanded of a good or service caused by a change in its price relative to substitutes.

Question 8

utility

Accepted Answer

___ is the satisfaction or pleasure derived from consumption of a good or service.

Question 9

total utility

Accepted Answer

____ is the total level of satisfaction derived from all units of a good or service consumed.

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