Which of the Following Is a Question Answered with Normative

question 186

Multiple Choice

Which of the following is a question answered with normative economic reasoning?

• A) If the college offers free parking for students, will more students drive to campus?
• B) If the college provided more financial aid assistance, would more students benefit?
• C) If the college increased tuition, would class size decline?
• D) Should the college cut tuition to stimulate enrollment?

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Definitions:

Purely Competitive Firm

Describes a business that operates in a market where no single company can influence prices, due to the presence of many sellers offering identical products.

Output

The quantity of goods or services produced in a certain period of time by a person, machine, or industry.

Price Taker

A market participant who has no influence over the market price and must accept the prevailing market price for its products or services.