lectur2-page36 - One major simplifying assumption made in...

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We make simplifying assumptions to develop models. Our purpose is not to try and capture every little detail and inter-relationship that may exist. We are looking more for the big picture, or basic understanding of what is occurring.
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Unformatted text preview: One major simplifying assumption made in economics is referred to as ceteris paribus. This is Latin for “other things being equal” or “all other things remaining constant”. 36...
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