"Animal spirits" refers to
A)the stubborn refusal of many economic decision-makers to use rational expectations.
B)movements in investment that cannot be explained by changes in current variables.
C)the often-observed Fed refusal to cooperate with the government in setting its monetary policy.
D)the impact of tax-evasion on the budget deficit.
E) an exotic alcoholic drink favored by Wall Street traders.

Question

Quizplus · Accepted Answer

"Animal spirits" refers to movements in investment that cannot be explained by changes in current variables. It was coined by economists John Maynard Keynes and F. Knight to refer to the emotional and psychological factors that influence economic decision-making, such as confidence, optimism, and pessimism.

"Animal Spirits" Refers to