Which of the following is an example of a normative statement?
a. The GDP growth rate has been unstable over five years
b. The tax rate should be reduced to improve the quality of life in an economy.
c. The unemployment rate has been below the natural rate of unemployment in the U.S for the last 2 years.
d. The inflation rate of 2015 exceeds the inflation rate of 2014.
b
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Changes in interest rates cause the same rotations of intertemporal budget lines regardless of whether you are a borrower or a saver.
Answer the following statement true (T) or false (F)
Keynesians tend to believe that
A. laissez-faire policies stabilize market economies. B. recessions are temporary. C. expansionary government spending and tax cuts are cures for recessions and depressions. D. in the short run, aggregate supply should be manipulated to stabilize the economy.
The first labor unions in the United States were
A) public-sector unions. B) industrial unions. C) guilds. D) craft unions.
An increase in the real interest rate would cause an increase in the real demand for money
A) no matter what the change in expected inflation. B) if expected inflation fell by less than the rise in the real interest rate. C) if expected inflation fell by the same amount as the rise in the real interest rate. D) if expected inflation fell by more than the rise in the real interest rate.