Abstract Economic Models Whose Assumptions and Conclusions Are Essentially Untestable

question 19

Multiple Choice

Abstract economic models whose assumptions and conclusions are essentially untestable are still useful because they

• A) indicate what data should be collected in the future.
• B) develop economists' intuition for more complex situations.
• C) can be illustrated using simple graphical techniques.
• D) capture the detail of realistic situations without any simplifying hypotheses.

---

Definitions:

Minimization Problem

A type of optimization problem focused on finding the lowest value of a function within a given set of constraints.

Reallocation

The process of relocating resources or assets from one place, project, or use to another to improve efficiency or outcomes.

Northwest Corner Allocation

The Northwest Corner Allocation is a method used in operations research for finding an initial feasible solution to a transportation problem by starting at the northwest corner of a cost matrix and allocating supplies to demands stepwise.

Source 1-Destination 1

Represents a simplified notation for mapping a specific source to a specific destination, often used in logistics and data flow diagrams.