Abstraction Is Used in Economics to Omit Unnecessary Details and Focus

question 231

True/False

Abstraction is used in economics to omit unnecessary details and focus on the essence of the problem being studied.

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Definitions:

Fixed Cost

Expenses that do not change in proportion to the activity of a business, such as rent, salaries, and loan payments.

Variable

A variable is an element, feature, or factor that is liable to vary or change; in mathematics and statistics, it's a quantity that can assume any of a set of values.

Output

The aggregate production of goods or services by an enterprise, economic sector, or the entire economy.

AVC

Another term for average variable cost, emphasizing the costs that vary with the level of output produced.