Question

The term "ceteris paribus" means that:

a. everything is variable.
b. all variables except those specified are constant.
c. no one knows which variables will change and which will remain constant.
d. what is true for the individual is not necessarily true for the whole.

Answer 1

The correct answer is letter B

Ceteris Paribus, also known as Coeteris Paribusis, means "all variables except those specified are constant".

In this way, Ceteris Paribus becomes a very important concept, as some studies that contain a large number of variables can be simplified.

In other words, you keep some variables constant, while you change others to identify their impact on the whole.

Let's imagine that you are making a pineapple juice with orange, and to make this juice you need 4 ingredients, water, pineapple, orange and sugar.

In this sense, for you to improve the juice you will touch the pineapple and orange variables, leaving the water and sugar variables unchanged and, to reach the ideal flavor, you decrease the pineapple and increase the orange or vice versa. This is the logic of Ceteris Paribus.