Question

Examine the role of assumption and observations in economics and substantiate it with an example
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Answer 1

Answer:

The assumptions of economists are made to you better understand consumer and business behaviour when making economic decisions. there are various economic theories to help explain how an economy functions and how to to maximize growth, wealth, and employment. however, the underlying themes of many theories centre around preferences, meaning what businesses and consumers preferred to have or prefer to avoid. also, the assumptions usually involved the resources available or not available to fulfill the needs and preferences. the scarcity or abundance of resources is important in in determining the choices that participants make in an economy.