Which of the Following Is a Normative Question

question 237

Multiple Choice

Which of the following is a normative question?

• A) Why do gasoline prices increase between Memorial Day and Labor Day?
• B) What will happen to gasoline consumption if the federal tax on gasoline is eliminated?
• C) To reduce the regressive nature of the gasoline excise tax, should the portion of the gasoline excise tax paid by high-income individuals be increased?
• D) How will oil exploration be affected if the government subsidizes oil producers?

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Definitions:

Perpetuity

An annuity that pays a fixed amount of money for an infinite amount of time.

Amortized

The process of gradually paying off a debt over time in regular installments of interest and principal sufficient to repay the loan fully by its maturity date.

Preferred Stock

A type of stock that typically pays fixed dividends and has priority over common stock in dividend payments and asset liquidation.

Perpetuity

A type of financial annuity that generates an infinite series of equal payments over an indefinable period of time.