Which Statement About Economic Models Is Not True

question 10

Multiple Choice

Which statement about economic models is not true?

• A) Analytical models consist of a clear set of assumptions and conclusions that are drawn from them.
• B) Economic models simplify reality because the economic reality is too complicated.
• C) Economic models consist of exogenous variables which are the response to changes in endogenous variables.
• D) Models are used in both theoretical and empirical work.
• E) Economic models must be coherent to be effective.

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Definitions:

Adjusting Entries

Adjusting entries are journal entries made in the accounting records at the end of an accounting period to allocate income and expenditures to the period in which they actually occurred.

Routine Entry

Regular, often daily, accounting entries that reflect standard business transactions.

Accrued

Describes expenses or revenues that have been incurred but not yet recorded through a payment or receipt, reflecting in accounts payable or receivable.

Deferred

Refers to items or transactions that have been postponed or delayed to a future date.