Economic Theories Are

question 87

Multiple Choice

Economic theories are

• A)useful because they are as exact as theories in the physical sciences
• B)useless because they are based on abstractions
• C)useful because they allow us to make predictions
• D)too complex to understand because they include all of reality
• E)useful in predicting events only if their assumptions are realistic

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Definitions:

Utility Function

Represents the satisfaction or welfare an individual obtains from consuming goods and services, indicating preferences over various bundles of goods.

Nuts

Specifically, types of fruit composed of a hard shell and a seed, which are generally rich in nutrients.

Berries

Small, juicy fruits with a high seed content, often colorful and consumed as food; includes strawberries, blueberries, raspberries, and many others.

Utility Function

A mathematical representation of how different quantities of goods or services generate satisfaction or utility for a consumer.