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Equilibrium in an Economic Model
An equilibrium is a self-perpetuating state within a model. Once this state is reached, it will persist because there is no internal tendency for change. The equilibrium will only be altered if it is disturbed by an external force, which is a factor determined outside the scope of the model itself.
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Social Science
Empirical Science
Science
Economy
CORE Econ
Economics
Ch.2 User-centered design process - User Experience Design - Winter 23 @ UI Design in UI @ University of Michigan - Ann Arbor
UI Design in UI @ University of Michigan - Ann Arbor
User Experience Design - Winter 23 @ UI Design in UI @ University of Michigan - Ann Arbor
UI @ University of Michigan - Ann Arbor
User Experience Design @ UI Design in UI @ University of Michigan - Ann Arbor
University of Michigan - Ann Arbor
Introduction to Microeconomics Course
Ch.2 Technology and incentives - The Economy 2.0 Microeconomics @ CORE Econ
Ch.8 Supply and demand: Markets with many buyers and sellers - The Economy 2.0 Microeconomics @ CORE Econ
Introduction to Macroeconomics Course
Ch.8 Economic dynamics: Financial and environmental crises - The Economy 2.0 Macroeconomics @ CORE Econ
The Economy 2.0 Macroeconomics @ CORE Econ
The Economy 2.0 Microeconomics @ CORE Econ
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Economics Models
4 Key Ideas of Economic Models
Applications of Economic Models
Model of Constrained Choice (Decision Making Under Scarcity)
Indifference Curves
Equilibrium in an Economic Model
Feasible Set
Constructing an Economic Model for Price Changes
An economist presents a model of the national housing market that only includes three variables: average household income, national interest rates, and the total number of new houses built per year. A critic argues the model is useless because it ignores dozens of other factors that influence a home-buying decision, such as local school quality, crime rates, and proximity to parks. Which of the following statements provides the most accurate evaluation of the critic's argument?
Choosing the Right Economic Model
The Purpose of Simplification in Economic Models
A social scientist wants to create a simplified representation to understand a specific economic interaction. Arrange the following steps into the logical sequence they would typically follow to construct this representation.
An economic model is considered more effective and useful the more real-world variables and complexities it includes.
An economic model can be represented in various ways. Match each type of model representation to the economic question it is best suited to illustrate or solve.
Because it is impossible to account for every detail of the millions of interactions that shape an economy, an economic model is a deliberately ______ representation of reality, designed to focus on the essential features relevant to a specific question.
An economist is developing a model to understand how a recent college graduate with a new job and a fixed monthly income decides how much of their income to spend on rent versus saving for retirement. The goal is to predict how their spending and saving choices might change if their income increases. Based on the purpose of this model, which of the following correctly identifies an essential feature to include versus an unimportant detail that can be ignored?
Evaluating a Model's Predictive Power
The 'Doing the Best You Can' Principle in Economic Modeling
Partial Equilibrium Analysis
Assessing an Economic Model by Comparing Predictions to Data
Evaluating an Economic Model's Effectiveness
The Process of Building and Validating an Economic Model
Learn After
Subsistence Level: Definition, Equilibrium, and Population Dynamics
Temporary Gains from Technology in the Malthusian Model
Malthus's Law
Nash Equilibrium
Equilibrium in the Multiplier Model
Equilibrium in Irving Fisher's Physical Model
Imagine a simplified model of a pond ecosystem. The population of frogs remains stable at 100 individuals year after year. The birth rate of frogs exactly matches the death rate (due to predation by herons and natural causes). The food supply for the frogs (insects) and the number of herons also remain constant. One year, a prolonged drought, a factor not typically included in this simple model, reduces the insect population. Which statement best analyzes the initial, pre-drought state of the frog population?
Stability and Disruption in a Model
Analyzing Market Stability
A system described by an economic model is considered to be in equilibrium only when all variables are static and can no longer change, even in response to forces from outside the model.
Match each term related to the concept of a system's state of balance with its correct description.
Analyzing a Stable System
Analyzing System Stability
The Corner Coffee Shop Model
A simple economic model describes a local farmer's market where, every Saturday, 10 farmers consistently sell all of their 50 baskets of apples each, for a total of 500 baskets sold. This state is considered to be in balance, as it has been self-perpetuating for many weeks with no internal tendency for change. Which of the following events represents a disturbance by an external force that would fundamentally alter this state of balance?
A small bakery uses a simple model to manage its daily production. The bakery is in a stable state, consistently baking and selling exactly 100 loaves of bread each day. Suddenly, a new large office building opens next door, an event not accounted for in the original model. Arrange the following events in the logical sequence that describes the system's disruption and its movement towards a new stable state.