ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Answer and Explanation: The above statement is false.

Detailed explanation-2: -The correct answer is option D) Economic models are not used to forecast. The statement is false because the economic models are used for forecasting.

Detailed explanation-3: -Most economic models rest on a number of assumptions that are not entirely realistic. For example, agents are often assumed to have perfect information, and markets are often assumed to clear without friction. Or, the model may omit issues that are important to the question being considered, such as externalities.

Detailed explanation-4: -There are four types of models used in economic analysis, visual models, mathematical models, empirical models, and simulation models.

Detailed explanation-5: -Economic Models and Math Economists use models as the primary tool for explaining or making predictions about economic issues and problems. For example, an economist might try to explain what caused the Great Recession in 2008, or she might try to predict how a personal income tax cut would affect automobile purchases.