Economics Is Called an Empirical Science Because

question 212

Multiple Choice

Economics is called an empirical science because

• A)economists study real-world evidence to test their models.
• B)economists use assumptions in their models.
• C)economic models have no predictive power.
• D)economic analysis is only useful in a capitalistic society.

Understand the effect of sample size and population standard deviation on the standard error of the mean.

Recognize the practical implications of hypothesis testing results in real-world scenarios.

Understand the concept of statistical significance and effect size in hypothesis testing.

Calculate the standard error of the mean based on the population standard deviation and sample size.

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Definitions:

Return on Investments

A performance measure used to evaluate the efficiency of an investment, comparing the return to the investment’s cost.

Share Repurchase

A program by which a company buys back its own shares from the marketplace, reducing the amount of outstanding stock and potentially increasing the value of remaining shares.

Excess Cash

This refers to the amount of money a company holds that is beyond what is required for its operational needs and potential investments.

Shares Outstanding

Represents the total number of shares of a corporation that are currently owned by all its shareholders, including share blocks held by institutional investors and restricted shares.