An Economic Model That Contains a Highly Realistic Set of Assumptions

question 18

Multiple Choice

An economic model that contains a highly realistic set of assumptions is

• A)necessarily better able to predict the future.
• B)superior to a model whose assumptions are highly unrealistic.
• C)more abstract than a model whose assumptions are further removed from reality.
• D)useful because there is then very little difference between "theory" and "reality".
• E)not likely to be useful because of its particularized nature and its intractability.

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Definitions:

Intermediate Levels

Positions or stages that are between the initial and final stages in a process, system, or hierarchy.

Compromise

A conflict management style that combines intermediate levels of assertiveness and cooperation.

Power Differences

The disparities in authority, control, and influence among individuals or groups within organizations or societies.

Scarce Resources

Essential inputs used in the production of goods and services that are limited in availability, necessitating effective management and allocation.