Andy is a brilliant young economist. He gradutes at the top of his class, magna cum laude, special honors, and distinguished honors. He is asked by the local school newspaper, which is running an article on him, how long he thinks it will take for him to get a job in this economy. Andy confidently says 1 week because with his stellar resume, he figures the companies will come calling despite the fact the housing bubble just popped. Three months later, he is still searching. Andy, in his job search, was.... Rational - Andy was being fair to all the people who did not yet have a job to let them have first shots at finding a job as he knew that he would instantly get job offers otherwise. Rational - He is exibiting bounded rationality by putting a time limit on when he expects to get a job. Rational - By setting such a bold statement, Andy is minimizing the amount of time needed to find a job, thus maximizing his utility in job searching. Irrational - Andy's overconfidence in his job prospects led his search to take longer than originally thought.
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- Andy confidently states he will get a job in one week due to his stellar resume. - He does not consider the broader economic context (housing bubble burst). Show more…
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