The importance of an economic model is that it allows us to

The importance of an economic model is that it allows us to:

build an accurate mathematical model of the economy.

build a complex and accurate model of the economy.

focus on the effects of only one change at a time.

avoid opportunity costs.

Solution

A economic model is a simplified representation of a real economic scenario to study the respective scenario. As economic models are simplified representation they are characterized by many assumptions which relate to many factors that may be dynamic in real economic scenario but were kept constant in model. Moreover, economic models are generally built to identify effect on one factor when another related factor changes while other related factors are kept constant.

For example, Law of demand represents an economic model where in we focus on change in quantity demanded due to change in price while other factors that can impact the quantity demanded are kept unchanged.

Hence, the importance of an economic model is that it allows us to focus on the effects of only one change at a time.

Thus, the correct answer is option (3).