An example of a normative statement is:
A) The rate of unemployment is 4 percent.
B) A high rate of economic growth is good for the country.
C) The federal government spends half of its budget on national defense.
D) People with health insurance tend to spend more on health care than those who are uninsured.
Ans: B) A high rate of economic growth is good for the country.
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Economic freedom is crucial for achieving economic growth because ______.
A. it gives the incentive to save, invest, expand human capital, and discover and apply new technologies B. it ensures that the majority of citizens make the most important decisions C. only good government can make the right investment decisions D. it protects workers' rights and prevents unfair firing E. it upholds democracy, which is essential if an economy is to grow
Which of the following statements best expresses why economic efficiency should be society's first goal?
A. Since the consensus on what is a fair distribution of goods is impossible, efficiency is the next best goal. B. Efficiency gives the poor an incentive to improve their economic status. C. Efficiency maximizes total economic surplus and thereby allows other goals to be more easily achieved. D. People are not really concerned about the problems of the poor, so government must address them instead.
An industry with a Herfindahl-Hirschman index of 10,000 would have no more than ______ firm(s).
A. 1 B. 2 C. 5 D. 100
Which of the following is an example of cyclical unemployment?
A. A worker stays at home to care for children. B. A student goes to school instead of working. C. An autoworker is laid off when auto sales fall due to a recession. D. A fast-food worker quits that job to find a better-paying job.