Normative Statements I.describe How the World Is

question 189

Multiple Choice

Normative statements
i.describe how the world is.
ii.describe how the world ought to be.
iii.depend on people's values and cannot be tested.

• A) i only.
• B) ii only.
• C) iii only.
• D) ii and iii.
• E) i and iii.

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Definitions:

Perfectly Competitive Market

A market structure characterized by many buyers and sellers, homogeneous products, and the freedom of entry and exit, leading to zero economic profit in the long run.

Marginal Revenue

The additional income received from selling one more unit of a product or service.

Profit-maximizing

The effort of a firm to adjust its production and sales strategies to generate the highest possible profit, taking into account cost and revenue curves.

Perfectly Competitive Market

A theoretical market structure where many buyers and sellers exchange identical products, and no single entity can influence the market price.