The Supply and Demand Model

question 62

Multiple Choice

The supply and demand model

• A) tries to include as many realistic details as possible in order to provide insights into real-world competitive markets
• B) uses simplifying assumptions while still providing insights into real-world competitive markets
• C) uses simplifying assumptions that severely limit its usefulness in practice
• D) is too complicated to be useful in practice
• E) is unable to explain price movements in most real-world competitive markets