"A reduction in the rate at which stock dividends are taxed will lead to greater investment in the stock market." This is an example of:
A)a positive economic statement.
B)a negative economic statement.
C)the fallacy of composition.
D)a normative economic statement.

Question

"A reduction in the rate at which stock dividends are taxed will lead to greater investment in the stock market." This is an example of:
A)​a positive economic statement.
B)​a negative economic statement.
C)​the fallacy of composition.
D)​a normative economic statement.

Quizplus · Accepted Answer

This statement is a positive economic statement, as it predicts a cause-and-effect relationship between a lower tax rate on dividends and greater investment in the stock market. It does not express any value judgments or opinions about whether this outcome is desirable or not.

"A Reduction in the Rate at Which Stock Dividends Are