Why is data an essential component of the scientific method?
What will be an ideal response?
Data are important for testing a model. Testing with data enables economists to separate the good models from the bad models. When a model is overwhelmingly inconsistent with data, economists try to fix the model or replace it altogether. Thus, data enables empirical testing of models to understand if a model is suitable to analyze the problem at hand.
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The price of a taco was $0.29 in 1970 and $1.09 in 2000. The CPI was 38.8 in 1970 and 172.2 in 2000. The 2000 price of a taco in 1970 dollars is:
A) $0.25. B) $0.29. C) $1.09. D) $4.84.
Deregulation has contributed to
A) an increase in union membership. B) declines in union membership. C) higher wages in unions. D) an increase in union power.
By enjoying more consumer goods today, the economy spurs growth in future consumer goods
a. True b. False Indicate whether the statement is true or false
If the cross-price elasticity of demand for two goods is negative, then the two goods are substitutes
a. True b. False Indicate whether the statement is true or false