Giddymoose
The Economic Problem - Assumptions in economics
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This study note for the Edexcel specification introduces fundamental concepts in economics as a social science. It explains how economists develop and utilize simplified models to analyze complex issues, emphasizing the crucial role of assumptions in this process. The text specifically highlights the use and limitations of the ceteris paribus assumption, which isolates the impact of one variable. Finally, it addresses the challenges economists face in conducting controlled scientific experiments, noting their reliance on natural experiments and empirical analysis to understand economic behaviour.