Normative economic analysis involves
A) true statements of facts only.
B) testable hypotheses by scientists.
C) value judgments and opinions.
D) purely descriptive statements.
Answer: C
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The law of demand states that, all else held constant,
A. price and quantity demanded are inversely related. B. the larger the number of buyers in a market, the lower the product price will be. C. consumers will buy more of a product at high prices than at low prices. D. price and quantity demanded are directly related.
Which of the following is NOT an example of firms trying to prevent resale?
A) Movie theatres check student ID for students' discounted tickets. B) An aluminum company starts its own wire production firm to sell to the aircraft parts at a higher price. C) Government limits the sale of international edition textbooks in the U.S. market. D) Milk producers sell the milk to processed dairy products producers at a lower price.
Slick Shades has a constant marginal cost of production equal to $80 and the distributors have a constant marginal cost of distribution equal to $30. If Slick Shades is producing the profit-maximizing number of sunglasses (in hundreds), what is the profit-maximizing wholesale price?
The figure above shows the wholesale demand and marginal revenue curves for Slick Shades Sunglasses, a sunglasses firm with market power. Slick Shades Sunglasses has a constant marginal cost of production and it sells to perfectly competitive independent retail distributors that have a constant marginal cost of distribution.
A) $150
B) $120
C) $140
D) $160
The multiplier is the ratio of the
A) change in the equilibrium level of real GDP to the change in autonomous expenditures. B) equilibrium level of real GDP to the change in induced expenditures. C) change in induced expenditures to the change in autonomous expenditures. D) change in autonomous expenditures to the change in the equilibrium level of real GDP.