Economic models are used to
A) simplify reality to predict outcomes.
B) exactly replicate reality.
C) predict all possible outcomes of a study.
D) determine the thoughts of individuals.
Answer: A
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"Scarcity implies that some way of rationing goods must be found." Explain what this statement means. How is this rationing done?
What will be an ideal response?
If the income multiplier is equal to 5, then a $1 initial increase the country's exports will lead to a
a. 5 percent decrease in national income b. 5 percent increase in national income c. $5 decrease in national income d. $5 increase in national income e. 0.05 percent increase in national income
The Council of Economic Advisers' Economic Report of the President discusses recent developments in the economy and presents the council's analysis of current policy issues
a. True b. False Indicate whether the statement is true or false
Refer to Figure 10.5. The deadweight loss associated with the monopoly would be:
A. $787.5. B. $612.5. C. $262.5. D. There is not sufficient information.