Question

1. (3 pts each) Rewrite each of the following normative statements so that it reads as a positive statement a) Marijuana should be legalized in all 50 states b) Attending class is worthless c) Collegiate athletes should be paid to compete in sports 2. (3 pts each) The idea of normative versus positive statements can also be applied to questions. Which of the following are normative questions and which are positive questions? Explain your thought process a) How will an increase in unemployment benefits affect the unemployment rate? b) Should UGA increase tuition to fund its athletic programs? c) If UGA offered free textbooks for students, would the average GPA rise? 3. (2 pts each) Explain why each of the following statements would or would not make a reasonable hypothesis to test. Use the concepts learned in class a) Taking vitamin supplements in older age leads to increased mortality b) Unemployment benefits are bad for society c) Supplement Nutritional Assistance Program (SNAP) participants purchase way too much soda with their benefits d) The United States should build a wall (or barrier) along the southern border e) States with legalized recreational marijuana have lower opioid overdoses . (10 pts) Analyze the following statemen "Economic models use many simplifying assumptions. Therefore, they do not apply to more complex events in the real world." 5. (15 pts) Many people believe that a significant number of on-farm jobs in the United States have been "taken" by immigrants (legal or otherwise) from Mexico. Describe (i.e., state your assumptions. hypothesis, data, and any problems you might encounter) how you would analyze the following statement: "The share of on-farm labor held by U.S. citizens has fallen over the past two decades due to Mexican immigration."

Answer 1

1. Normative statements concerns what should be and what ought to be, whereas positive statements concerns what is, was or will be.

a) Marijuana is legalized in all 50 states.

b) Attending class is worthless.

c) Collegiate athletes will be paid to compete in sports.

2. a) Positive question

b) Normative question

c) Normative question

Normative question concerns about the opinions and cause and effect analysis whereas positive question concerns the facts and final impact of any particular event.

3. a) Reasonable hypothesis - It is reasonable as tries to find out the effect of taking vitamin supplements in older age and the mortality rate which can be tested.

b) Unreasonable hypothesis - It is unreasonable as it is a very subjective topic to find out the ill effects of unemployment benefits on society.

c) Reasonable hypothesis - It is reasonable as it finds out the cause and effect analysis.

d) Unreasonable hypothesis - It is unreasonable as it involves a subjective topic of building a wall.

e) Reasonable hypothesis - It is reasonable as it finds out the cause and effect analysis.

4. Economic models are not all very simple. It makes use of human behavior in relation to a particular event and thus is a behavioural approach. Many of the mathematical expressions like production function, demand function can be expressed in terms of models and can be used for solving business problems. The graphical presentation of law of demand also mentions that at a particular price point, how much quantity is demanded and thus solves the complex business problems. Thus economics models are simple but can be used to solve complex business problems.