Why Do Economists Use Economic Models

question 62

Multiple Choice

Why do economists use economic models?  

• A) to construct simplifying assumptions about real world economics 
• B) to explain economic reality in all its complexity 
• C) to explain and predict economic events 
• D) to construct economic situations where controlled experiments can be carried out

---

Definitions:

Job Order Costing

An accounting methodology used to allocate costs to specific batches or lots of products, often used in custom manufacturing.

Videographer

A professional or skilled individual who captures moving images on video, either as a hobby or for commercial purposes.

Job Order Cost System

An accounting system that accumulates costs for each individually identified job or order, tracking materials, labor, and overhead.

Process Cost System

An accounting system that accumulates costs for each process or department within a factory, suitable for continuous production environments.