Nature of economics-economics methodology

Question 1

chain of analysis for ceteris paribus

Answer 1

is economics is a social science-its hard to build theories with so many factors that can change- so they use the ceteris paribus theory-everything is assumed to stay constant-only one thing is changing

Question 2

ceteris parabus example

Answer 2

ceteris paribus-if price of headphones decreases- sales increase

Question 3

economics social science chain

Answer 3

economics is a social science- studies of societies and social interactions- they cant test factors like normal scientists- due to so many changing factors

Question 4

economic methodology steps

Answer 4

1 (observations)- 2 (formimg hypothesis) lead to possible explanations of what you’ve observed-3 (predictions) what you think will happen based on your hypothesis-4 (testing) use evidence through testing to prove our predictions - this then creates a theory as it has survived testing and is supported by evidence