An economist at the University of Alberta in Edmonton has been asked to explain why the price of Albertan crude oil has fallen recently. Which steps should the professor take in order to assemble a scholarly answer?

Question

Quizplus · Accepted Answer

The best approach would be for the economist to develop a hypothesis, test the proposition by engaging in empirical analysis, and examine the data to see if it fits with the facts. This approach involves a rigorous and objective analysis that will help to ensure that the conclusions are supported by evidence. Gathering data on seemingly unrelated variables (as in B) or looking at other industries that may have different structures (as in C) may not be as effective in explaining the recent drop in oil prices. Using a questionnaire to determine why residents are not purchasing oil (as in D) may also be limited in its scope and may not provide a complete explanation.

An Economist at the University of Alberta in Edmonton Has