Which of the following is most likely to represent causality rather than association?
A) In years that fashion dictates wider lapels on men's jackets, the stock market grows by at least 5 percent.
B) Interest rates are higher in years ending with a 1 or a 6.
C) Unemployment falls when the AFC champion wins the Super Bowl.
D) Quantity demanded goes up when price falls because lower prices increase consumer purchasing power, ceteris paribus.

Question

Which of the following is most likely to represent causality rather than  association?
A) In years that fashion dictates wider lapels on men's jackets, the stock market grows by at least 5 percent.
B) Interest rates are higher in years ending with a 1 or a 6.
C) Unemployment falls when the AFC champion wins the Super Bowl.
D) Quantity demanded goes up when price falls because lower prices increase consumer purchasing power, ceteris paribus.

Quizplus · Accepted Answer

Choice D provides a clear explanation of the causal relationship between price and quantity demanded based on the economic principle of purchasing power. The other choices may suggest an association, but do not provide a clear explanation of causality.

Which of the Following Is Most Likely to Represent Causality