Economic Models

question 181

Multiple Choice

Economic models

• A)are constructed to mirror reality as closely as possible,and in this respect economic models are no different from other scientific models.
• B)are constructed to mirror reality as closely as possible,and in this respect economic models are very different from other scientific models.
• C)are simplifications of reality,and in this respect economic models are no different from other scientific models.
• D)are simplifications of reality,and in this respect economic models are very different from other scientific models.

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Definitions:

Precautionary Motive

A rationale for holding money or liquid assets to guard against future uncertainties and potential emergencies.