If a person decides to take a new job offer based only on a

If a person decides to take a new job offer based only on a salary increase this would be an example of what type of decision making? o normative economics o positive economics o microeconomics e macroeconomics

Solution

If a person decides to take a new job offer based only on a salary increase this would be an example of positive economics.

Positive economics is economics that does not apply objective to what an economy is doing or what it ought to be doing. For example if it describes equilibrium level of price and quantity but giving no statements on whether it is an appropriate price or quantity to the market. If it examines the quantity theory of money and the interest rate but never states the interest rate is good or bad, it is positive economics. In short the positive economics states what an economy is without applying goals and value to them. The positive economics is subjective.

The normative economics is on the other hand is objective and it put goals and objectives on an economy. If it states that the GDP is low and it suggests the methods to increase the GDP. It is normative economics. It also suggest that the commercial banks to control rate of interest to rise the borrowing and thereby the GDP of the economy. It is normative economics. The statement that a person accepts a job offer only on salary increase is a positive economic. But if it states what is the change in his real income if he accept the job or why is choosing the job simply based on salary is a normative economics.

Consumption is using up of goods and service for the satisfaction of human wants. Consumption sometimes causes destruction of commodity in case of perishable goods like fruits, vegetables and a glass of milk etc. Sometimes consumption may be a prolonged process in case of durable goods. For example furniture, car etc. Consumption may be direct of final consumption when the goods satisfy the wants directly and immediately. For example wearing a shirt, eating food and using furniture satisfy human wants directly. Sometimes consumption may be indirect or productive consumption when the goods are not used for final consumption but used for producing other goods which satisfy human wants indirectly. For example the use of a sewing machine in a cloth factory satisfy human wants indirectly. The business consumption is indirect consumption.

The purchase clothes, food, movies etc it is simply consumption which is direct.

A price tag is price at which the goods or service offered for sale in money terms.