Which of the following is a normative economic statement?O Rising global demand for coal has led to increases in the price of coal.O With rising mortgage rates and rising unemployment rates, the number of unsold homes hasincreased.O The state of Texas is considering increasing funds for light-rail development to promote the use ofpublic transportation.○ Pharmaceutical manufacturers should not be allowed to patent their products so prescription drugswould be more affordable.

The objective of the question is to identify which of the given statements is a normative economic…

Answered: Which of the following is a normative…

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter1: The Role And Method Of Economics

Section: Chapter Questions

Problem 8P

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Similar questions

Would an op-ed piece in a newspaper urging the adoption of a particular economic policy be a positive or normative statement?
What is an example of a problem in the world today, not mentioned in the chapter, that has an economic dimension?
Explain why societies cannot make a choice above their production possibilities frontier and should not make a choice below it.
What is absolute advantage? What is comparative advantage?
What does a production possibilities frontier illustrate?
A country called Sherwood is very heavily covered with a forest of 50,000 trees. There are proposals to clear some of Sherwoods forest and grow com, but obtaining this additional economic output will have an environmental cost from reducing the number of trees. Table 12.11 shows possible combinations of economic output and environmental protection. Sketch a graph of a production possibility frontier with environmental quality on the horizontal axis, measured by the number of trees, and the quantity of economic output, measured in corn, on the vertical axis. Which choices display productive efficiency? How can you tell? Which choices show allocative efficiency? How can you tell? In the choice between T and R, decide which one is better. Why? In the choice between T and S, can you say which one is better, and why? If you had to guess, which choice would you think is more likely to represent a command-and-control environmental policy and which choice is more likely to represent a market-oriented environmental policy, choice Q or S? Why?
It is clear that productive inefficiency is a waste since resources are used in a way that produces less goods and services than a nation is capable of. Why is allocative inefficiency also wasteful?
Why is a production possibilities frontier typically drawn as a curve, rather than a straight line?
Residents of the town of Smithfield like to consume hams, but each ham requires 10 people to produce it and takes a month. If the town has a total of 100 people, what is the maximum amount ham the residents can consume in a month?
HighFlyer Airlines wants to build new airplanes with greatly increased cabin space. This will allow HighFlyer Airlines to give passengers more comfort and sell more tickets at a higher price. However, redesigning the cabin means rethinking many other elements of the airplane as well, like engine and luggage placement, and the most efficient shape of the plane for moving through the air. HighFlyer Airlines has developed a list of possible methods to increase cabin space, along with estimates of how these approaches would affect the planes operating costs and ticket sales. Based on these estimates, Table 13.5 shows the value of R, how much should the firm invest in R on top of the private return; that is, an R private return to HighFlyer Airlines would have a 9 social return. How much investment is socially optimal at the 6 interest rate?
What are the similarities between a consumers budget constraint and societys production possibilities frontier, not just graphically but analytically?
What are three reasons to study economics?

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