Which of the following statements could be considered a normative statement?
A. Most low-income people use Food Stamps to buy food.
B. A large portion of the government budget is used to provide Food Stamps to low-income people.
C. Food stamps allow low-income people to buy more food.
D. Food stamps are a good way to help low-income people to afford food.
Answer: D
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Income elasticity is used to determine whether a product is a normal or inferior good
Indicate whether the statement is true or false
Which of the following determines the opportunity set of possible choices for leisure and income?
a. The wage rate b. The aggregate price level c. The unemployment rate d. The utility from leisure
Ruben earned a salary of $60,000 in 2001 and $80,000 in 2006 . The consumer price index was 177 in 2001 and 221.25 in 2006 . Ruben's 2006 salary in 2001 dollars is
a. $20,000; thus, Ruben's purchasing power increased between 2001 and 2006. b. $20,000; thus, Ruben's purchasing power decreased between 2001 and 2006. c. $64,000; thus, Ruben's purchasing power increased between 2001 and 2006. d. $64,000; thus, Ruben's purchasing power decreased between 2001 and 2006.
An economy in which output has decreased and prices have decreased would suggest a:
A. decrease in short-run aggregate supply. B. increase in aggregate demand. C. increase in short-run aggregate supply. D. decrease in aggregate demand.