Economic models do not reflect the full complexity of reality, but instead are based on
A) simplifications.
B) trade-offs.
C) value judgments.
D) predictions.

Question

Quizplus · Accepted Answer

Economic models are simplifications of reality, as they aim to isolate specific variables and relationships to help understand economic phenomena. They necessarily leave out many factors and nuances of the real world in order to be useful for analysis and prediction purposes. While economic models may involve trade-offs and value judgments, those are not the primary basis for their construction.

Economic Models Do Not Reflect the Full Complexity of Reality