How Is an Economic Theory Tested

question 263

Multiple Choice

How is an economic theory tested?

• A) by assessing the realism of its assumptions
• B) by comparing and contrasting its simplicity with related theories
• C) by comparing its predictions with real-world observations
• D) by polling economists to see if there is consensus as to the validity of the hypothesis

---

Definitions:

Excluded

Being intentionally left out or omitted from a group or an activity.

Grit

A psychological trait based on an individual's passion for a particular long-term goal coupled with a powerful motivation to achieve their respective objective.

Emotional Pain

Emotional pain is a deeply unpleasant psychological response that can result from a variety of life events, including loss, rejection, or disappointment.

Narcissism

A character quality defined by an excessive perception of one's own value, a desire for praise, and an absence of compassion for other people.