Economic Models Are Only Applicable to Free-Market Countries

question 16

Multiple Choice

Economic models are only applicable to free-market countries.

• A) False. Economic models are applicable wherever there is scarcity.
• B) True. Economic models are applicable only when private citizens are free to make their own decisions.
• C) False. Economic models are applicable in all countries with more than one million people, regardless of political structure.
• D) True. Economic models are only applicable when government is small relative to the rest of the economy.

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Definitions:

Negative Reinforcement

A behavioral strategy that increases the likelihood of a response by removing an unpleasant stimulus.

Modeling

The process of creating representations of complex real-world phenomena to predict outcomes or understand mechanisms, often used in science and economics.

Punishment

A penalty imposed on someone for a wrongdoing or transgression, intended as correction or deterrence.

Integrity

The quality of being honest and having strong moral principles.