A critical assumption differs from a simplifying assumption in that a critical assumption
A) is a means of getting rid of extraneous details in the model
B) cannot affect the conclusions of the model
C) can affect the conclusions of the model
D) is rarely used in economic models
E) is never a fundamental assumption

Question

Quizplus · Accepted Answer

A critical assumption can affect the conclusions of the model, while a simplifying assumption is used to get rid of extraneous details but does not necessarily impact the conclusions.

A Critical Assumption Differs from a Simplifying Assumption in That