The Basic Purpose of Economic Models Is To

question 114

Multiple Choice

The basic purpose of economic models is to:

• A)construct simplifying assumptions about the real world.
• B)explain reality in all its complexity.
• C)collect empirical data to support the facts.
• D)construct situations where controlled experiments can be carried out.
• E)explain and predict economic events.

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Definitions:

Unpaid Voucher File

A file that keeps track of vouchers which have been issued but not yet paid.

Cash Discounts

A reduction in the invoice amount by a seller, offered to the buyer in return for early payment of their bill.

Stock Dividends

A form of dividend payment made in the form of additional shares rather than cash, increasing the number of outstanding shares.

Separation Of Duties

A risk management strategy that divides responsibilities within an organization to reduce the risk of fraud or error.