To Disentangle Cause and Effect, Economists Use Economic Models and Use

question 167

Multiple Choice

To disentangle cause and effect, economists use economic models and use ________ to test the predictions of those models.

• A)the what, how, and for whom questions
• B)positive statements and normative statements
• C)personal economic policy, business economic policy, and government economic policy
• D)natural experiments, statistical investigations, and economic experiments
• E)marginal benefit and marginal cost

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Definitions:

Unexpected Changes

Unexpected changes refer to unforeseen events or shifts in the marketplace, economies, or natural environment that can significantly impact businesses, economies, and societies.

Price Indexes

Statistical measures that track changes in the price level of a basket of goods and services over a period of time.

Nominal GDP

The total market value of all final goods and services produced within a country in a given period, measured using current prices without adjustment for inflation.

Real GDP

The measure of a nation's total economic output adjusted for price changes and inflation, representing the actual value of goods and services.