Evaluate the followingstatement: \"It is easier to build an economic model that

Question

Evaluate the followingstatement: "It is easier to build an economic model that accuratelyreflects events that have already occurred than to build aneconomic model to forecast future events." Do you think that thisis true or not? Why? What does this imply about the difficulties ofbuilding good economic models?
I am just stumped on thisone. I know that it is easier to build an economic model onpast events but I don't know what it implies about the difficultiesof building good economic models.   Thanks for anyhelp.
Evaluate the followingstatement: "It is easier to build an economic model that accuratelyreflects events that have already occurred than to build aneconomic model to forecast future events." Do you think that thisis true or not? Why? What does this imply about the difficulties ofbuilding good economic models?
I am just stumped on thisone. I know that it is easier to build an economic model onpast events but I don't know what it implies about the difficultiesof building good economic models.   Thanks for anyhelp.

Explanation / Answer

True, based on existing models such as the circular flow model. One direction flows from producers to consumers, while the other way it flows back from consumers to producters. Forecasting future events can be difficult to predict.

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