Economic theories are:

A) useful because they are as exact as theories in the physical sciences.
B) useless because they are based on abstractions.
C) useful because they allow us to make predictions.
D) too complex to understand because they include all of reality.
E) useful in predicting events only if their assumptions are realistic.

Economic Theories

A set of principles that explain how economies function, including the distribution of resources, and the production and consumption of goods and services.

Abstractions

The process of extracting the underlying essence or general principles of a concept, situation, or phenomenon, often by neglecting concrete details.

Physical Sciences

Branches of science that study inanimate natural objects, including astronomy, chemistry, physics, and earth sciences.