In choosing among alternative models,economists generally have the strongest preference for models that
A)have assumptions that are close to exact replicas of reality.
B)are detailed and complex,with every available fact and figure included.
C)have few assumptions and are as simple as possible,even if they cannot predict very well.
D)predict better than any other that is available.
E)have assumptions that are complicated.

Question

Quizplus · Accepted Answer

Economists generally prefer models that predict better than any other available models in order to make more accurate decisions and interpretations of economic phenomena. While it is important to have sound assumptions and simplicity where possible, predictive accuracy is often considered the most important factor in model selection.

In Choosing Among Alternative Models,economists Generally Have the Strongest Preference