To Abstract from Reality in an Economic Model Means That

question 98

Multiple Choice

To abstract from reality in an economic model means that

• A) we include only a few of the essential aspects of reality.
• B) the economic study surveys only a very limited period of time.
• C) we include only those elements which support our hypothesis.
• D) the model includes every aspect of the real world.
• E) the model examines the actions of the consumers in the absence of producers and the government.

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Definitions:

Alternative Hypothesis

In hypothesis testing, it is the hypothesis that suggests there is a statistically significant effect or difference between groups or variables, as opposed to the null hypothesis.

Null Hypothesis

A statistical hypothesis that assumes no significant difference or effect, serving as the default assumption to be tested against an alternative hypothesis.

Null Hypothesis

A default hypothesis that there is no effect or no difference, and it is the hypothesis that researchers aim to test against.

Equals Sign

A symbol denoting mathematical equality between two expressions.