Which of the Following Is an Example of a Normative

question 33

Multiple Choice

Which of the following is an example of a normative statement?

• A) A higher price for a good causes people to want to buy less of that good.
• B) A lower price for a good causes people to want to buy more of that good.
• C) To make the good available to more people, a lower price should be set.
• D) If you consume this good, you will be better off.

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Definitions:

Outstanding Voting Stock

The total shares of a corporation's stock that are currently owned by shareholders, including those with voting rights.

Long-Term Investment

Investments held for an extended period, typically longer than one year, to achieve sustained growth or income.

Net Income

The profit of a company after all expenses, taxes, and costs have been subtracted from total revenue.

Equity Method

An accounting technique used by firms to assess the profits earned through their investments in other companies, recording these investments at cost and subsequently adjusting them to reflect the investee's changes in net assets.