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JAWBONING: The use of verbal encouragement or discouragement by political leaders or other influential people to achieve particular results. This term was coined in reference to actions by President Lyndon Johnson in the 1960s. It is essentially an attempt by the President or other influential leaders to change public sentiment and move the economy in a particular direction without implementing or waiting for the results of formal economic policies. This also goes by the term moral suasion.

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Lesson 2: Economic Science | Unit 4: Science and Practice Page: 14 of 20

Topic: Theory <=PAGE BACK | PAGE NEXT=>

What theory inspired this hypothesis?
  • The suspicion might be informal, but that doesn't mean it lacks the basics of a theory:
  • World View:
    • Instructors are 'nice' people, who know and like students in the front of the class better-- and thus award them higher grades.
  • General Laws of Nature:
    • Less information reaches students seated in the back because of physical laws governing the diffusion of light and sound.
    • More motivated students, who study more and earn higher grades, are inclined to sit near the front of the class.

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DERIVATION, CONSUMPTION LINE

A consumption line, a graphical depiction of the relation between household sector consumption and income, can be derived from a simple consumption schedule, a table or chart showing the relation between household sector consumption and income. This is easily accomplished by plotting the consumption-income pairs from the schedule as points in a diagram that measures consumption on the vertical axis and income on the horizontal axis, then connection the points with a line. The consumption line can also be derived directly by plotting the consumption function using slope and intercept values.

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Today, you are likely to spend a great deal of time going from convenience store to convenience store seeking to buy either storage boxes for your income tax returns or an AC adapter for your CD player. Be on the lookout for small children selling products door-to-door.
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During the American Revolution, the price of corn rose 10,000 percent, the price of wheat 14,000 percent, the price of flour 15,000 percent, and the price of beef 33,000 percent.
"I've always believed that if you put in the work, the results will come. I don't do things half-heartedly. Because I know if I do, then I can expect half-hearted results. "

-- Michael Jordan, basketball player

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