What are the distinctions made in the text among the terms “hypotheses,” “theories,” “laws,” and “principles”?
Please provide the best answer for the statement.
Hypotheses are propositions that are tested and used to develop economic theories. Highly reliable theories are called principles or laws. Theories, principles, and laws are meaningful statements about economic behavior or the economy that can be used to predict the likely outcome from an economic action or event. Models are created when several economic principles are used to explain or describe reality.
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Economic analysis requires both mathematical reasoning and historical study
a. True b. False Indicate whether the statement is true or false
If the demand function for a particular good is Q = 50 ? 4P, then demand at a price of $10 is:
A. unit elastic. B. elastic. C. inelastic. D. Elasticity cannot be determined.
In game theory, the strategy that results in the highest payoff to a player regardless of what the other player decides to do is called the:
A) Stackleberg equilibrium. B) equilibrium strategy. C) min-max strategy. D) dominant strategy.
In marginal cost pricing, the natural monopoly would have to set price equal to
A) AFC. B) AVC. C) ATC. D) MC.