What is meant by empiricism? How do empiricists use hypotheses?
What will be an ideal response?
Empirical evidence is a set of facts established by observation and measurement, which are used to evaluate a model. Empiricism refers to the practice of using data to test economic models. When conducting empirical analysis, economists refer to a model's predictions as hypotheses. Hypotheses are predictions (typically generated by a model) that can be tested with data.
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In the long run, in a monopolistically competitive market, price will be
A) equal to MR. B) equal to MC. C) greater ATC. D) equal to ATC.
In the short run, a firm continues to produce only if it can cover the:
a. fixed costs. b. sunk costs. c. explicit costs. d. variable costs. e. implicit costs.
In competitive markets,
a. firms produce identical products. b. no individual buyer can influence the market price. c. no individual seller can influence the market price. d. All of the above are correct.
Economic growth can be shown by
A. no change in the long-run aggregate supply curve. B. a leftward shift in the long-run aggregate supply curve. C. a rightward shift in the long-run aggregate supply curve. D. a leftward shift in the production possibilities curve.