The economic model's validity is determined:
A)by convincing a great deal of economists of its correctness.
B)by testing it using real life evidence.
C)by testing it using experiments involving undergraduate economics students.
D)by making sure they have a flawless logic.

Question

Quizplus · Accepted Answer

The validity of an economic model is best determined by testing it using real-life evidence. This means observing how the model holds up in actual economic situations and analyzing the data to see if it supports the model's predictions. It is important to note that while the model may have flawless logic, its real-world performance is what ultimately determines its validity. Convincing economists or conducting experiments involving undergraduate economics students may provide some support for the model, but it does not necessarily prove its validity.

The Economic Model's Validity Is Determined