Normative statements are
a. not usually made by economists.
b. claims about how the world should be.
c. claims about how variables in the economy normally behave.
d. pessimistic interpretations of the economy.
b
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Since 1970, the world Gini ratio has ________ indicating that the world distribution of income has ________
A) risen; become more equal B) fallen; become more equal C) risen; become less equal D) not changed; not changed
Goods that are income elastic are often referred to as luxury goods
Indicate whether the statement is true or false
Assume that Nation A's production possibilities are either 30 units of bricks or 50 units of wheat. Nation B's production possibilities are 20 units of bricks and 40 units of wheat. Which of the following is true?
A. The high-cost producer of bricks is Nation A. B. Nation A is the least-cost producer of wheat. C. According to the principle of comparative advantage, Nation B should specialize in the production of bricks. D. The opportunity cost of wheat production is lower in Nation B.
Which economic theory argues that changes in velocity are predictable and the crowding-out effect is substantial?
A. classical theory B. Keynesian theory C. monetarist theory D. Marxist theory