An economic model is a representation of economic reality that
A) highlights all possible variables and the relationships among them.
B) highlights particular variables and the relationships among them.
C) predicts how government actions influence the private sector.
D) illustrates the difference between economic and non-economic theories.
E) focuses strictly on welfare economics.

Question

Quizplus · Accepted Answer

An economic model highlights particular variables and the relationships among them, rather than all possible variables. It is a simplified representation of the real world, used to help us understand economic phenomena and answer economic questions.

An Economic Model Is a Representation of Economic Reality That