Economists need different models of the economy because
A) the economy behaves differently depending on how much time has passed after a demand shock.
B) we need a different model to analyze a positive demand shock than we need to analyze a negative demand shock.
C) the way economic performance is measured changes over time.
D) prices tend to be less ﬂexible over time.

Question

Quizplus · Accepted Answer

Economists use different models to account for the varying behaviors of the economy over time, especially in response to demand shocks. Different models help in understanding how the economy adjusts in the short term versus the long term after such shocks.

Economists Need Different Models of the Economy Because