Positive Economics Is Descriptive Because ________

question 44

Multiple Choice

Positive economics is descriptive because ________.

• A) it is based on ethical judgments.
• B) its predictions cannot be verified with data.
• C) it prescribes what an individual or society ought to do.
• D) it explains what has happened or predicts what will happen.

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Definitions:

Production Constraint

A limitation or bottleneck in the production process that restricts output, efficiency, or the utilization of resources.

Profits

The financial gain achieved when the revenues from business operations exceed the expenses, costs, and taxes involved in sustaining the operation.

Opportunity Costs

The value of the best alternative that is foregone when a different option is chosen.

Special Order

A one-time order that is not considered part of the company’s normal ongoing business.