Which of the Statements Below Is/are Normative

question 44

Multiple Choice

Which of the statements below is/are normative?

• A) Economists need to include more reality in their models.
• B) Economists will use a model until it is refuted by someone.
• C) Microeconomists study economic growth.
• D) B and C

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Definitions:

Put Contract

An options contract that gives the holder the right to sell a specified amount of an underlying security at a specified price within a specified time.

Put Premium

The price that must be paid to purchase a put option, which gives the holder the right but not the obligation to sell a specified quantity of an underlying asset at a set price within a specified time.

Maximum Profit

The highest possible financial gain achievable from an investment or business operation, often estimated under ideal conditions.

Stock-Index Option Markets

Marketplaces where options based on the movements of stock market indices are traded, allowing investors to speculate or hedge against market swings.