The models used in economics:
A)are always limited to variables that are directly related.
B)are essentially not reliable because they are not testable in the real world.
C)are of necessity unrealistic and not related to the real world.
D)emphasize basic relationships by abstracting from complexities in the everyday world.

Question

Quizplus · Accepted Answer

Economic models are simplified versions of the real world, where the complexities and interactions are removed to identify the fundamental relationships between variables. These models are not expected to capture every intricate detail of the real world, but they are still valuable in helping to identify causal relationships between important variables.

The Models Used in Economics