Which of the following is an example of a normative economic statement?
a. The inflation rate in the United States decreased from 4 percent last year to 3 percent this year as a result of lower energy prices.
b. The economy grew at an annual rate of 5 percent during the first quarter of this year.
c. If two automobile companies merge, it is likely that the price of automobiles will rise.
d. An increase in international trade benefits some workers but hurts others.
e. The minimum wage should be increased so that low income workers can afford to keep up with the cost of living.
E
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By studying the effects of choice architecture, we can:
A. blend the ideas of psychology with core economic beliefs. B. expand the simplifying assumption that people always make the choices that are best for themselves. C. open the possibility that we can no longer tell if someone is making a mistake or choosing something that is maximizing his utility. D. All of these statements are true.
When US inflation is rising, ___
a. purchasing power will increase b. $100 will buy fewer goods and services today than last year c. the value of the dollar is rising d. all
If South Korea has an absolute advantage in the production of an item, it must also have a comparative advantage in the production of that item.
Answer the following statement true (T) or false (F)
A regulated natural monopolist allowed to earn a "fair" rate of return would produce to the point at which
A. the price per unit equals its marginal revenue. B. the price per unit equals the long-run average cost. C. the marginal revenue curve meets the long-run average cost curve. D. the marginal revenue curve meets the long-run marginal cost curve.