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Do assumptions in a model have to be realistic for a model to be useful? See below when Friedman describes the decision-making of businessmen. Are
Do assumptions in a model have to be realistic for a model to be useful? See below when Friedman describes the decision-making of businessmen. Are they really maximizing profits or minimizing costs in real life? If not, then why do we learn this model in Econ 310? Similarly, does the consumer's utility maximization problem contain assumptions? Are these assumptions realistic? Does it matter
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Macroeconomics Principles Applications And Tools
Authors: Arthur O Sullivan, Steven M. Sheffrin, Stephen J. Perez
7th Edition
978-0134089034, 9780134062754, 134089030, 134062752, 978-0132555234
