All of the following are examples of normative statements EXCEPT:
A. Reducing inflation should not be done at the expense of more unemployment.
B. Economic growth should not be allowed to exceed 5 percent per year.
C. The Federal Reserve should act decisively to reduce inflation.
D. Unexpectedly high inflation redistributes wealth from lenders to borrowers.
Answer: D
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Assume that a firm is operating in the short run and all resources are fixed except for labor. The total product curve for this firm will increase at a decreasing rate because:
a. value of marginal product of labor is unchanged as more labor is hired. b. marginal product of labor will decline as more labor is hired. c. value of marginal product of labor will increase as more labor is hired. d. marginal product of labor is unchanged as more labor is hired.
In general we may note that inflation:
A. always increases purchasing power. B. should try to be avoided at all costs. C. doesn't necessarily harm purchasing power. D. always decreases purchasing power.
Which theorem tells us that no voting system is perfect?
A. Bowman's problematic theorem B. Arrow's impossibility theorem C. Condorcet paradox D. Median-voter theorem
The one word in the definition of economics that focuses on the fact that we have to make choices about who gets what and how much is
A. scarcity. B. allocation. C. study. D. resources.