1. When do assumptions made in conjunction with economic theorizing have to be realistic? Can unrealistic assumptions provide useful outcomes?© BrainMass Inc. brainmass.com October 9, 2019, 9:17 pm ad1c9bdddf
Economic models, like all models, use simplifications to represent reality. It is understood that the model's results will not predict reality perfectly, but a good model should allow us to draw general conclusions that can be useful for policy-makers. For example, if we only need to know the direction of ...
The importance of accurate assumptions in economic theorizing; comparison of socialism and capitalism.