When an economist wants to develop a theory to explain the effect of the price of oil on economic growth
A)the first step is to state the research question.
B)the first step is to examine the data.
C)the first step is to work out the implications of the theory.
D)he/she should start with microeconomic analysis.

Question

Quizplus · Accepted Answer

The first step in developing a theory is to clearly state the research question that the theory aims to answer. This will provide a framework for examining the relevant data and working out the implications of the theory. Microeconomic analysis may be relevant, but it is not necessarily the starting point for developing a theory about the effect of oil prices on economic growth.

When an Economist Wants to Develop a Theory to Explain