-Write one paragraph on whether you agree or disagree with this criticism. Why d
ID: 1132532 • Letter: #
Question
-Write one paragraph on whether you agree or disagree with this criticism. Why do we use models at all, and how should we balance the need for simplicity with the need for accuracy?
-Write one paragraph explaining what makes a good model. Find an example of a model (in economics or elsewhere) in the real world and explain if you think your example strikes the right balance between details and simplification of use.
-Using your mode write one paragraph explaining the model and the degree of usefulness (any strengths or weaknesses).
The very first step to the economic model is “the role of assumptions,” and that is already unrealistic. Something that is assumed is unrealistic. For a certain amount of time going based off behavioral assumptions may be slightly correct, but it won’t stay constant. Society is always changing. Some of the ways models are used are for the environment, health care, and poverty, those three topics can change one minute to the next. A good model can be easily read. A person should be able to do the calculation of a slope and figure out what the outcome would be if something increases or decreases. I came across a model about “Health System Tracker.” This diagram shows the spending of Medicaid and Medicare from 1970s to 2025 of medical expense and prescriptions. When looking at the “Health System Tracker” it shows what’s being spent, the time frame, and how much. In the “Health System Tracker,” you can see that in the earlier years Medicaid and Medicare spent more on prescriptions and health care compared to today. Throughout the years it has gone up and down, also switching which expense increased and decreased. The actual slopes show all these changes while the projected is showing a non-changing.
Were All 3 Questions Above Answered Successfully? Do You Agree With Or Disagree With The Answers/Explanation? Why Or Why Not? Explain. 1 Paragraph Maximum.
Explanation / Answer
Economics aspects are essentially an investigation of between connections between various factors that make up working of an economy. Given the immense number and multifaceted nature of factors and their connection, making a model without suspicions or taking certain criteria to be given or steady is nearly impossible. Each variable has different causal factors. If we need to decide connection between only two factors, accepting others to be consistent is permissible. Be that as it may, alert must be taken while deciding the measure of impact the specific autonomous variable has on the dependent variable. Economists use models in order to give a name or a specific flow (or causal relation) to the relationships they discover, in order to make model, explaining the reasons for both positive and normative economics would be highly difficult. Models are what we can say as examples to the relationship we are defining. A good model should always be specific to time and region. Given the vast differences between economic activities and other macro-economic indicators, generalization of economic models is foolish. For example, relying on model given by a Swedish person in 1900 cannot be implemented in India in 2018. Assumptions are required, but the model should make sure to intimate (mostly some number in percentage) that the relationship may also be affected due to the assumptions. This is enhances discussion and hence pave a path for others to speculate on the relationship. Yes, a balance between accuracy and simplicity is needed but based on the application; we can decide which has to be given more weight age or importance. The Keynes model of Psychological consumption function is a good example of a balance between accuracy and simplicity. The relationship that income determines the consumption so as clear as possible and a accurate description. Although theories after Keynes suggested various variations to the consumption function, Keynes did a good job of identifying the fundamental causal relationship. It may be current income or future income or transitory income, but the essence that INCOME determines consumption has been well captured by his theory. And with succeeding theories we can understand the strength and weakness and variations of the theory, but nobody can go against the theory that Income does determine consumption.
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