An economic theory is

The correct answer is: C. A hypothesis

An economic theory is a statement about the relationship between two or more economic variables. It is a hypothesis that has been tested and supported by evidence.

An axiom is a statement that is assumed to be true without proof. A proposition is a statement that is offered for consideration. A tested hypothesis is a hypothesis that has been tested and found to be true or false.

Here are some examples of economic theories:

• The law of demand states that, all other things being equal, the quantity demanded of a good or service will decrease as the price of that good or service increases.
• The theory of comparative advantage states that a country should specialize in the production of goods and services in which it has a comparative advantage, and trade with other countries for goods and services in which it does not have a comparative advantage.
• The theory of the firm states that a firm will maximize its profits by producing the quantity of output at which marginal revenue equals marginal cost.

Economic theories are important because they help us to understand the world around us. They can be used to make predictions about the future, and they can be used to design policies that will improve economic outcomes.