An economist at the University of Alaska at Anchorage has been asked to explain why the price of Alaskan crude oil has fallen recently. In order to develop a model, the professor should take which steps?
A. Identify the problem, develop a model based on simplifying assumptions and test the model to formulate a conclusion.
B. Gather data on crude oil prices and seemingly unrelated variables to look for associations, then formulate a hypothesis based on those unexpected associations.
C. Ask people in Alaska why they are not purchasing oil.
D. None of these. The oil industry is controlled by a cartel; therefore price changes in the industry cannot be explained using economic theories.
Answer: A
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If at its current production level, a perfectly competitive firm's marginal revenue and long-run marginal cost are equal to $5 and its long-run average cost is $4, which of the following statements is true?
A) The firm should expect the market price of its product to increase. B) The firm should expect the market price of its product to fall. C) The firm should expect to earn positive economic profit indefinitely. D) The firm should expect the market supply curve to decrease.
Inventory changes, a component of GDP, includes those that are planned as well as those that are unplanned
Indicate whether the statement is true or false
Which of the following is true?
a. The earnings differential between men and women who never married is considerably smaller than the differential between married men and married women. b. After adjusting for education, age, language, and location, the earnings of women are almost identical with the earnings of men. c. Between 1980 and 2000 . the female/male annual earnings ratio of full-time workers was virtually unchanged. d. The hourly earnings of women were approximately 60 percent of their male counterparts in 2009.
What is the function of an economic system?
a. to make sure all people have equal access to goods b. to produce and distribute goods and services c. to give all producers the same access to consumers d. to make sure people are paid for their labor