Author Question: Izzy Amador is a highly talented tattoo artist. She has chosen to specialize in tattoo art because ... (Read 146 times)

luminitza · **on:** Jun 29, 2018

Izzy Amador is a highly talented tattoo artist. She has chosen to specialize in tattoo art because of all of the following except

A) for her, this is the most lucrative way to purchase the products that she wants to consume.
B) her tattoos are highly esteemed by tattoo lovers who are willing to pay very high prices.
C) her opportunity cost of pursuing another career is very low.
D) she obviously has a comparative advantage in tattoo art.

Question 2

What are two important properties of economic models? Models tend to be simplified descriptions of a real-world phenomenon. Does this mean that they are unrealistic?

What will be an ideal response?

Hikerman221 · **Reply #1 on:** Jun 29, 2018

Answer to Question 1

C

Answer to Question 2

A good economic model has two important properties. First, it is an approximation. The model predicts what would happen on average. Second, it makes predictions that can be tested with data.
A model is a simplified description, or representation, of reality. Because models are simplified, they are not perfect replicas of reality. However, this does not mean that they are unrealistic. Models are usually simplified in order to be able to isolate the relationship between two variables. Even if a model is based on simplified assumptions, it may still help us make good predictions and plan for the future.