In an Economic Model,assumptions

question 159

Multiple Choice

In an economic model,assumptions

• A)must be applicable to many real-world situations.
• B)must be eliminated before being used to make sure the model is realistic.
• C)are not important in determining the usefulness of the model.
• D)define the set of circumstances in which the model is likely to be applicable.

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Definitions:

Supply Curve

A graphical representation showing the relationship between the price of a good and the quantity of that good that sellers are willing to supply.

Minimum Price

Is the lowest price at which a product or service can be sold, often set by law or regulation to protect producers or consumers.

Producer

An individual, company, or entity that creates goods or provides services.

Total Cost

The entirety of expenses, fixed and variable, involved in the production of services or goods.