Which of the following statements is true?
A)Economic theory does not make unrealistic assumptions.
B)Economists should not ignore details while focusing on complex problems.
C)Abstraction forms an important part of economic analysis.
D)The word theory means same for both economists and laymen.

Question

Quizplus · Accepted Answer

Abstraction, or simplification of real-world concepts and variables, is a crucial aspect of economic analysis as it allows for the formulation of models that can be easily analyzed and tested. A) is false as economic theory often relies on assumptions that may not hold true in real-world situations. B) is also false as economists often use simplifications and assumptions to focus on the most important aspects of complex problems. D) is false as the meaning of theory may differ between economists and laymen.

Which of the Following Statements Is True