1
Question
Economic laws are essentially _________.
Economic laws are essentially _________.
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Solution
The correct option is A conditional
It is true that many microeconomic laws may involve many assumptions, which makes the theory valid only under the specific conditions of the model, which tend to over-simplify the situation and as a result may not hold true in the real world (such as perfect competition market structure). However, the broad theories (such as theory of supply and demand for example) are still valid in the real world, it has been proven time and again with empirical data.
It is true that many microeconomic laws may involve many assumptions, which makes the theory valid only under the specific conditions of the model, which tend to over-simplify the situation and as a result may not hold true in the real world (such as perfect competition market structure). However, the broad theories (such as theory of supply and demand for example) are still valid in the real world, it has been proven time and again with empirical data.
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