Which of the Following Is NOT Normative Economic Statement

question 70

Multiple Choice

Which of the following is NOT normative economic statement?

• A) The minimum wage should be eliminated so unemployment can be reduced.
• B) Increases in the minimum wage cause increases in unemployment.
• C) The inflation rate should fall to increase individuals' well being.
• D) Taxes on cigarettes should be increased to reduce smoking.

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Definitions:

Market-Equilibrium

A condition where the supply and demand in the market equalize, leading to stable prices.

External Cost

A cost borne by individuals or society that is not reflected in the market price of a good or service, often associated with negative externalities.

Socially Optimal

A condition or point at which the welfare of a society reaches its highest possible level, considering all factors and resources.

Demand Curve

A graphical representation of the relationship between the price of a good and the quantity demanded.