To test their theories, economists usually have to
A) set up careful laboratory experiments with all variables controlled.
B) first examine theory and compare it with what happened in the past in the real world.
C) use only models that have a proven record of success.
D) conduct experiments that involve people who do not behave rationally.
Answer: B
Economics
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The figure above shows a consumer is indifferent between points
A) d and c. B) a, b, c, d, and e. C) e and d. D) b and a.
Economics
If the price elasticity of demand for a good is 5.0, then a 10 percent increase in price results in a
a. 0.5 percent decrease in the quantity demanded. b. 2.5 percent decrease in the quantity demanded. c. 5 percent decrease in the quantity demanded. d. 50 percent decrease in the quantity demanded.
Economics