An Example of Normative Analysis Is Studying

question 200

Multiple Choice

An example of normative analysis is studying

• A)how market forces produce equilibrium.
• B)surpluses and shortages.
• C)whether equilibrium outcomes are socially desirable.
• D)income distributions.

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Definitions:

Impact

The effect or influence of one factor on another, often used to describe the outcomes or changes resulting from a particular action or policy.

Financial Accounting

Financial accounting is the branch of accounting that focuses on the preparation of financial statements for external users, such as investors and creditors.

Deficit

A situation where expenses exceed revenues, or liabilities exceed assets.

Retained Earnings

Net earnings not distributed as dividends but reinvested back into the company or kept as a reserve for future use.