Which of the following observations is t?
A) Free markets will achieve all of society's goals.
B) The ability to buy goods is divided equally among consumers.
C) The market deals with efficiency in production through the profit motive.
D) The market system encourages firms to use inputs wastefully.

Question

Quizplus · Accepted Answer

Observation C states that the market deals with efficiency in production through the profit motive. This is a description of how the market system works, and therefore represents a positive statement, or a statement of fact, which can be analyzed using economic principles. Observations A, B, and D are normative statements, or statements of opinion, which cannot be analyzed using economic principles.

Which of the Following Observations Is T