How Does an Economist Define a Good Economic Theory

question 189

Multiple Choice

How does an economist define a good economic theory?

• A) an abstraction from reality useful for explaining but not predicting behaviour (since theories are too simplistic)
• B) an opinion that can be tested against economic data
• C) an abstraction for the sake of argument
• D) a statement or relationship that is used to explain and predict human behaviour

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Definitions:

Annul

To legally declare invalid or void, commonly used in contexts such as marriage annulment, which renders the marriage as if it never existed.

Confidential Relationship

A relationship where one party places trust and confidence in another with the expectation that the latter will act in their best interest, typically involving nondisclosure of certain information.

Undue Influence

A situation where an individual is able to persuade another's decisions due to the relationship between the two parties, often leading to unfair advantage.

Duress

A situation where a person performs an act as a result of violence, threat, or other pressure against the person, raising questions about the voluntariness of the act.