Economic models are used to
A) represent the complexities of economic environments.
B) explain every detail of an economic theory.
C) explore decision making by individuals, firms and other organizations.
D) build physical renditions of government construction projects.
C
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If a firm produces a given amount of output using the least amount of inputs, it definitely achieves economic efficiency
Indicate whether the statement is true or false
Which of the following is not an obstacle to development for many less-developed countries?
a. limited capital goods production b. lack of infrastructure c. lack of skilled workers d. dependence on exports of natural resources e. high savings rate
If the federal funds rate is at its target 3.5 percent, inflation is 1.5 percent, and target inflation is 2.5 percent. If the Taylor rule is accurate, the output was:
A. 1.5 percent above potential. B. 1.5 percent below potential. C. 1 percent above potential. D. 1 percent below potential.
Comparing a perfectly competitive market to a monopoly, which of the following is true?
A. Price will be higher and quantity will be lower in the perfectly competitive market than in the monopoly. B. Price will be higher than marginal cost in the perfectly competitive market but will be equal to marginal cost in the monopoly. C. Price will be equal to marginal revenue in the perfectly competitive market but will be higher than marginal revenue in the monopoly. D. at that point on the market demand curve which intersects the marginal cost curve, the monopolist and the perfectly competitive firm will maximize profits.