A Good Economic Theory

question 102

Multiple Choice

A good economic theory

• A)has realistic assumptions
• B)contains as much detail as possible
• C)cannot be proven false
• D)predicts well
• E)can only be presented in mathematical terms

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Definitions:

Vertical Differentiation

The organization of a company's hierarchy levels to distinguish roles and responsibilities across different ranks.

Complexity

The degree to which many different types of activities occur in the organization.

Formalization

The process of establishing official procedures and rules within an organization.

Specialization

The process of focusing on a narrow area of expertise, enhancing efficiency and proficiency in performing specific tasks or roles.