Positive economics is a method of inquiry that attempts to explain the observable, and is limited to verifiable statements, while normative economics suggests a course of action that we should take based on a particular set of values and preferences
a. True
b. False
Indicate whether the statement is true or false
True
You might also like to view...
A zero economic profit is not a bad thing because:
a. it is a situation in which the owners, or shareholders, of a firm could not do better elsewhere. b. it is a situation in which the resources of a firm are always optimally utilized. c. it means that a firm is paying an interest rate that is below the market rate. d. it means that stock prices will not fall. e. it means that investors are better off in the current venture than they would be in any other investment.
In the Keynesian aggregate expenditure model, the equilibrium level of income is achieved when
a. actual saving equals actual investment. b. planned aggregate expenditures equal total output. c. consumption equals income times the marginal propensity to consume. d. the marginal propensity to consume equals planned output.
In 1986, the base year, GDP was 4000. In 1989 the GDP deflator was 115. We may conclude that
A.there was some inflation between 1986 and 1989. B. there was some deflation between 1986 and 1989. C. real GDP declined between 1986 and 1989. D. GDP declined between 1986 and 1989.
When comparing the U.S. and Mexican car assembly industries, the disadvantage of higher U.S. wages is offset by
A) Mexican trade barriers. B) trade adjustment assistance in the United States. C) higher productivity in the United States. D) a lower opportunity cost in Mexico.