To Be Useful, an Economic Theory Should

question 34

Multiple Choice

To be useful, an economic theory should

• A)be based on reasonable assumptions.
• B)generate predictions that can be verified with actual data.
• C)actually have its predictions corroborated with data.
• D)be based on reasonable assumptions, generate predictions that can be verified with actual data, and actually have its predictions corroborated with data.

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Definitions:

Retailer

A business or individual that sells goods or services directly to consumers, typically operating out of physical or online stores.

Bullwhip Effect

A situation in supply chain management where slight shifts in demand from consumers cause increasingly amplified shifts in demand at the levels of manufacturers, distributors, and wholesalers.

Primary Causes

Fundamental reasons or root causes that directly lead to an event, situation, or outcome, distinct from secondary or tertiary factors.

Remedy

Refers to a treatment, solution, or means of correcting or improving a problem, situation, or condition.