Normative economics involves
A) a statement of fact.
B) a statement of "what should be."
C) a statement of "what is."
D) a statement that is purely descriptive.
B
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Suppose Spam is an inferior good. If the U.S. economy hit bad times, and demanders' incomes were to fall, which of the following would tend to occur?
A) Spam sales would increase. B) Spam demand would decrease. C) The price of Spam would increase. D) Both A and C above. E) Both B and C above.
The principle of comparative advantage helps explain trade between nations
a. True b. False Indicate whether the statement is true or false
If parking spaces on a college campus are scarce, with quantity demanded during the "peak" hours, from 8 a.m. to 11 a.m., far greater than the number of spaces, an economist would propose as an efficient solution,
a. lowering the parking fees during those hours to compensate students for the longer search time. b. charging the same parking fees during all hours of the school day. c. raising parking fees during the peak hours to encourage some students to schedule classes during other hours when parking fees are lower. d. hiring more security guards to patrol for illegal parkers.
In this graph, point E2 is a(n) ______ equilibrium point because it ______.
a. sustainable; is on the LRAS curve
b. sustainable; is on the SRAS curve
c. unsustainable; decreases output, but not prices from e1
d. unsustainable; decreases prices, but not output from e1