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econ questions Consider two statements based on analysis of a proposed increase

ID: 1093399 • Letter: E

Question

econ questions

Consider two statements based on analysis of a proposed increase tax on wages:
I. An increased tax on wages will reduce the number of hours worked and reduce the take-home income of workers.
II. An increased tax on wages should not be implemented because it will harm both firms and workers.

Statement I and II are both examples of positive economics.

Statement I and II are both examples of normative economics.

Statement I is an example of positive economics; statement II is an example of normative economics.

Statement I is an example of normative economics; statement II is an example of positive economics.

1 points   

Question 4

Economics _______ limitations. Most ethical considerations are _______ of economic theory.

has; left out

has; not left out

does not have; left out

does not have; not left out

1 points   

Question 5

Many objections exist to standard economic reasoning. Economics either ignores or inadequately treats all of the following, EXCEPT:

problem of exploitation.

private market goods.

cultural goods.

poverty and inequality.

1 points   

Question 6

Suppose someone is arguing against a particular market transaction by claiming that it exploits individuals. It may be reasonable to ban this market transaction if it can be established that the people involved _______ rationally or that they __________ all of the risks involved.

are acting; understand

are acting; do not understand

are not acting; understand

are not acting; do not understand

1 points   

Question 7

Billy is said to have meddlesome preferences if:

he has preferences over other people

Statement I and II are both examples of positive economics.

Statement I and II are both examples of normative economics.

Statement I is an example of positive economics; statement II is an example of normative economics.

Statement I is an example of normative economics; statement II is an example of positive economics.

Explanation / Answer

1) C

2) A

3) B

4) D

5,6 C

7 D

8,9 B

10 A

11 C

12 B

13 C

14,15 D

16 C

17 A

18 D

19 B

20 C