A Theory Can Best Be Defined as

question 228

Multiple Choice

A theory can best be defined as

• A)an untested assertion of untested fact.
• B)a collection of assumptions that simplify the real world.
• C)an opinion of a reliable person who studies a subject or discipline.
• D)a deliberate simplification of factual relationships that attempts to explain how those relationships work.
• E)the body of knowledge that has been scientifically verified by the scientific community.

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Definitions:

Economic Profits

The difference between total revenue and total costs, including both explicit and implicit costs, indicating the financial gain in excess of the opportunity costs.

Long-run Equilibrium

A state in which all firms in a market are earning zero economic profits, ensuring that no firm has an incentive to enter or exit the market.

Industry

Describes the aggregate of manufacturing or technically productive enterprises in a particular field, often named after its principal product.

Demand Curve

A chart that illustrates how the price of a product correlates with the amount consumers are ready to buy at different price levels.