10 1. Which of the following is a question that might be answered bynormative economics?A) Will the unemployment rate rise if we raise income taxes?B) What should the highest marginal income tax rate be?C) Who has the authority to raise sales taxes?D) What will happen to GDP if we raise sales taxes?2. A model is a theory:A) that does not apply to the real world.B) that has been simplified to a story, a graph, or a math problem.C) that has been proven to be true.D) that has not yet been empircally tested.3. Broadly speaking, the two approaches to answering important economicquestions are:A) hierarchy and command.B) spontaneous markets and market hierarchy.C) markets and spontaneous order.D) hierarchy and spontaneous order.4. Which of the following is TRUE?A) Trade based on absolute advantage can always benefit all countriesinvolved.B) Trade based on comparative advantage can always benefit all countriesinvolved.C) Trade based on comparative advantage usually benefits some countriesand hurts others.D) Trade based on comparative advantage only benefits countries that alsohave an absolute advantage.

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1. Which of the following is a question that might be answered by normative economics? A) WHLl the unemployment rate rise if we raise income taxes? B) What should the highest marginal income tax rate be? C) Who has the authority to raise sales taxes? D) What will happen to GDP if we raise sales taxes?

1. Which of the following is a question that might be answered by normative economics? A) WHLl the unemployment rate rise if we raise income taxes? B) What should the highest marginal income tax rate be? C) Who has the authority to raise sales taxes? D) What will happen to GDP if we raise sales taxes?

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter26: The Neoclassical Perspective

Section: Chapter Questions

Problem 10RQ: Do neoclassical economists tend to focus more on long term economic growth or on recessions? Explain...

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