Which of the Following Is a Normative Statement

question 152

Multiple Choice

Which of the following is a normative statement?

• A)The U.S.rate of unemployment was lower in 2004 than it was in 1994.
• B)Savings accounts earn interest, whereas checking accounts do not.
• C)Congress must recognize that the growing national debt is the most serious problem that the country faces.
• D)The unemployment rate increases when the percentage of the labor force without jobs increases.
• E)The unemployment rate among teenagers is higher than the rate among adults.

---

Definitions:

Required Rate

The minimum annual percentage return on an investment that an investor aims for, considering the investment's risk.

Retaining Earnings

Profits that a company reinvests in itself instead of paying out to shareholders as dividends.

Flotation Costs

Those costs occurring when a company issues a new security, including fees to an investment banker and legal fees.

New Common Shares

Issuance of additional shares of a company's stock, which can dilute existing shareholders' equity but raise new capital for the company.