Economic theories:
A) express normative values.
B) invent imaginative and interesting stories.
C) use the fallacy of composition to validate hypotheses.
D) predict cause and effect in the real world.
E) use only perfect and complete information to formulate and test hypotheses.

Question

Quizplus · Accepted Answer

Economic theories aim to predict cause and effect in the real world by analyzing data and empirical evidence. While economic theories may have normative implications, their primary purpose is to explain and make predictions about economic phenomena through observed behaviors and interactions. They do not use fallacies or rely solely on perfect information.

Economic Theories