QUESTION 36 Minimum wage is higher today than it was twenty

QUESTION 36 Minimum wage is higher today than it was twenty years ago. Is this a positive or normative statement? 1.

Solution

36.

Positivestatement can be defined as those statements which can be tested and verified with the available evidence and data.

Since the statement that minimum wage is higher today than it was 20 years ago, this can be tested and verified with the available data. Hence this is a positive statement.

The opportunity cost can be defined as what is given up for producing an extra unit of another goods.

Hence opportunity cost of moving from B to C will be

=(40-25)/(70-50)

=15/20

=0.75 guns.