Question

Most economic models: A. are useless because they use too many simplifying assumptions. B. assume that people are reluctant to learn from their mistakes. C. assume that people behave irrationally. D. assume that people behave rationally.

Answer 1

D. Assume that people behave rationally.

Step-by-step explanation:

When a decision maker chooses the option leading to the outcome that he or she most prefers, he or she has made a rational decision. These are the decision that based on facts, data and research, which make it more credible and worthy to be trusted. Therefore most economic model consider every people behave rationally and read information to get aware about situation and can implement economic tools.