These four steps, in the following order, are used to study macroeconomic behavior:
(1) document the facts;
(2) use the model to make other predictions that may eventually be tested;
(3) compare the predictions of the model to the original facts; and
(4) develop a model.

Question

Quizplus · Accepted Answer

The correct order for studying macroeconomic behavior typically starts with (1) documenting the facts, then (4) developing a model based on these facts, followed by (2) using the model to make predictions that can be tested, and finally (3) comparing the predictions of the model to the original facts to assess its accuracy.

These Four Steps, in the Following Order, Are Used to Study