To avoid increasing the national debit, the federal government should increase income taxes. This is an example of a ______.
a. normative statement
b. positive statement
c. hypothesis
d. theory
a. normative statement
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The above table gives the demand schedule for a single-price monopoly. The marginal revenue first becomes negative when going from
A) 1 unit to 2 units. B) 2 units to 3 units. C) 3 units to 4 units. D) 4 units to 5 units. E) None of the above; the total revenue is always positive so the marginal revenue must always be positive.
If the income elasticity of potatoes is -0.7, then the income effect caused by a price decrease of potatoes
A) tends to increase the consumption of potatoes. B) tends to decrease the consumption of potatoes. C) is less than the substitution effect. D) None of the above.
Scott's Painting Company paints houses. Since Scott's business does not have the name recognition of some of the bigger painting companies, Scott advertises a "Five-Year Money Back Guarantee" to indicate to buyers that his service is of high quality. This guarantee is an example of
a. screening. b. signaling. c. the seller's curse. d. the principal-agent problem.
The state of the economy during the 1970s and 1980s reinforced the ideas of Keynesian economic policies and their ability to successfully manage the macroeconomy.
Answer the following statement true (T) or false (F)