If a model fits reality but doesn't generate testable predictions, it is of little value to economists
Indicate whether the statement is true or false
True
If the model doesn't deliver testable predictions it cannot be tested against competing models.
You might also like to view...
In long-run equilibrium, compared to a perfectly competitive market, a monopolistically competitive industry produces a ________ level of output and charges a ________ price
A) higher; lower B) lower; higher C) lower; lower D) higher; higher
Are government activities of any concern to macroeconomists?
A) Yes, since government actions and policies can affect an economy's overall performance. B) Yes, since macroeconomics is defined as the study of the role that government plays in the economy. C) No, since the government cannot affect the functioning of the private economy. D) No, since macroeconomists study hypothetical economies that have no government involvement at all.
If loans are $300,000, checkable deposits are $600,000, and the required reserve ratio is 40 percent, then excess reserves are:
A. $360,000. B. $240,000. C. $120,000. D. $60,000.
Analysis indicates that the economy is in a recessionary gap. Which of the following is the least appropriate policy mix in this situation?
A. A budget surplus and expansionary monetary policy B. A budget deficit and expansionary monetary policy C. A budget deficit and contractionary monetary policy D. A budget surplus and contractionary monetary policy