Which of the following might be an example of an economic argument against advertising?
a. It causes the demand for the good to be more elastic
b. It allows the producer to earn an economic profit in the long run
c. People may be deluded into thinking that a good with a brand name is better than an otherwise identical generic brand
d. The claims made in the ads are almost always false
c
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Suppose that a bank has $250 in vault cash, $750 in deposits at the Federal Reserve, $9,000 of loans, and deposits of $10,000. What is the bank's reserve ratio?
a) 2.5% b) 10% c) 33% d) 90%
The economic analysis of minimum wage involves both normative and positive analysis. Consider the following consequences of a minimum wage:
a. The minimum wage law causes unemployment. b. Unemployment would be lower without a minimum wage law. c. Minimum wage laws benefit some workers and harm others. d. The minimum wage should be more than $7.25 per hour. Which of the consequences above are positive statements and which are normative statements? A) a and b are positive statements, c and d are normative statement. B) Only a is a positive statement, b, c, and d are normative statements. C) a and c are positive statements, b and d are normative statements. D) a, b, and c are positive statements and d is a normative statement.