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A Model with Two Variables: Figure 6 illustrates four different ways to model the economic relationship between the number of doctors employed at an HMO and the number of physical examinations given. The four ways are: (1) with words; (2) with a numerical value; (3) with a graph; and (4) with algebra or an equation. Figure 7: Economic Models in Four Ways The Ceteris Paribus Assumption
Ceteris Paribus: "all other things equal"; refers to holding all other variables constant or keeping all other things the same when one variable is changed. Positive versus Normative Eco...
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- Spring '10
- Economics, Normative Economics, healthcare spending, economic event, POSITIVE VERSUS NORMATIVE, versus normative economics