Explanation An economic model is a theoretical set up that is used to represent the economy with the help of a set of variables and the set of assumptions and relations between the variables. It helps the economists to test the hypotheses and verify the results that are difficult to do on actual economy. Option (c): Under the model building process in economics, there will be a set of variables and the relations between them. The hypothesis is being tested and verified on these variables. Thus, there should be some simplified assumptions that help the model building to be a smooth operation as well as a simplified task. This means that option 'c' is correct. Option (a): There will be many exceptional situations in the economy and when the model is built by adjusting to these exceptional situations, then the model will be a biased one with the exceptions in the base, which makes the model less effective...

10th Edition

ISBN: 9781337613057

Author: Tucker

Publisher: CENGAGE L

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Question

Chapter P1, Problem 3KC

To determine

The important step when building a model.

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Chapter P1 Solutions

MACROECONOMICS FOR TODAY

Ch. P1 - Prob. 1KC Ch. P1 - Prob. 2KC Ch. P1 - Prob. 3KC Ch. P1 - Prob. 4KC Ch. P1 - Prob. 5KC Ch. P1 - Prob. 6KC Ch. P1 - Prob. 7KC Ch. P1 - Prob. 8KC Ch. P1 - Prob. 9KC Ch. P1 - Prob. 10KC

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