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.
D
You might also like to view...
There is no shortage of scarce resources in a market economy because
a. the government makes shortages illegal. b. resources are abundant in market economies. c. prices adjust to eliminate shortages. d. quantity supplied is always greater than quantity demanded in market economies.
Individuals, firms, and societies are limited in the amount of goods and services that they can produce. This is a direct result of:
A. unemployment. B. waste. C. scarcity. D. irrational behavior.