Which One of the Following Is a Normative Economic Statement

question 103

Multiple Choice

Which one of the following is a normative economic statement?

• A) The unemployment rate fell for the fourth straight month, reflecting the effects from stronger economic growth in the second quarter.
• B) The worsening balance of trade must be corrected if this nation is to remain competitive in the world economy.
• C) Consumer prices are rising at a faster rate than in past months, indicating a renewal of inflationary pressures on the economy.
• D) To help balance the Federal budget, Congress increased the tax on gasoline to its highest level in the past 10 years.

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Definitions:

Beginning Capital Balance

The beginning capital balance is the amount of capital or equity that a company has at the start of a new accounting period.

General Ledger

A comprehensive set of accounts that records all financial transactions of a business, showing assets, liabilities, equity, revenue, and expenses.

Owner Withdrawals

Money or assets taken out of a business by the owner(s) for personal use.

Owner's Equity

The residual interest in the assets of a company after deducting liabilities, representing the ownership interest of shareholders or owners.