Computer models of the economy:
A) usually consist of only a few equations.
B) require no assumptions about monetary and fiscal policy.
C) require assumptions about monetary and fiscal policy.
D) give excellent predictions regardless of assumptions about monetary and fiscal policy.

Question

Quizplus · Accepted Answer

Computer models of the economy require assumptions about monetary and fiscal policy in order to make projections and predictions. These assumptions can include variables such as interest rates, government spending, and taxation policies, among others. Without assumptions about these policies, the models would have no way to simulate the effects of different economic scenarios or project future outcomes.

Computer Models of the Economy