Question

1) Please write an example for a posthoc fallacy
2) Demand for cars depends on many factors such as the price of cars, income, price of public
transportation, price of gasoline. We want to see the relation between demand for cars and
price of gasoline. What does ceteris paribus imply?
3) Write an economic variable that changes over time
4) Write an economic variable that changes from observation to observation

Answer 1

1- The Latin Phrase " post hoc ergo propter hoc" means " after this, therefore because of thid." The fallacy is generally referred to by the shorter phrase, " post hoc." Examples : " Every time that rooster crows, the sun comes up.The rooster must be very powerful and important!"

-Examples:

" Every time that rooster crows the sun

comes up. That rooster must be very

powerful and important!".

" Nearly all heroin addicts used marijuana

Before they tried heroin.Clearly marijuana

use leads to heroin addiction.

2- Remember that we saw that a household's decision about whether to buy a car depends on mant different factors, including income, interest rates, the current and expected price of gasoline, the price of public transportation, and so on. The price elasticity of demand depends on the decisions of other producers.

-Gas and cars are complimentary goods. When the price of one falls, the demand for other increases. This result in an increase in demand for cars in general, and less fuel efficient cars in particular.

-Those studies found that higher gasoline prices increased the demand for smaller , more - fuel - efficient vehicles relative to larger, less - efficient vehicles. That relationship continues to hold with recent vehicle sales, according to several current economic studies.

-"This commonly- used phrase stands for all other things being unchanged or constant ".

-The opposite for this is the phrase ' mutatis mutandis', which states changing some factors that need to be changed.

-Ceteris paribus is often a fundamental assumption to the predictive purpose of scrutiny .

3- Economists assess the success of an economy's overall performance by studying how it could achieve high rates of outpur and consumption growth.

-For the purpose of such an assessment, three macroeconomic variables are particularly important: gross domestic product (GDP) , the unemployment rate, and the inflation rate.

4-Economic variables that changes  from observation to observation that determine supply and demand, so ceteris paribus assumption simplify the equation so that casual change can be isolated.

-Economic models assume that in the real world, several things may be changing at once.

-In what way are models helpful to economist?

-Models are helpful to economists and us by helping us understand the way the real world works.