Which of the following is NOT a normative economic statement?
A) States should reduce the tax on heating fuel oil during the winter.
B) The price of gasoline is too high.
C) People over the age of 75 should not be allowed to drive cars.
D) Teenagers are responsible for most driving fatalities.
E) We don't spend enough money on anti-smoking campaigns.
D
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Fill in the blank: ________ leads to speculation
A) Love B) Uncertainty C) Greed D) Money E) Sin
The small-firm effect refers to the
A) negative returns earned by small firms. B) returns equal to large firms earned by small firms. C) abnormally high returns earned by small firms. D) low returns after adjusting for risk earned by small firms.
Suppose that labor productivity in one economy is higher than it is in some other economy. Does that mean that the first economy is using its productive resources better than the second economy? Explain
What will be an ideal response?
Two ways to postpone diminishing returns are:
a. Increase labor and improve education. b. Increase all resources together and make the production process more efficient. c. Actually, there is no way to postpone diminishing returns. d. Keep the government budget balanced and increase the money supply at a rate that keeps inflation low (e.g., at 2% or whatever the national goal happens to be). e. Increase the quantity of capital.