The distribution of income should be determined by the government ...

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The distribution of income should be determined by the government is an example of a positive economic statement.
 
  Indicate whether the statement is true or false

Question 2

Refer to Figure 3-5. In a free market such as that depicted above, a shortage is eliminated by
 
  A) a price decrease, decreasing the supply and increasing the demand.
  B) a price increase, increasing the quantity supplied and decreasing the quantity demanded.
  C) a price increase, increasing the supply and decreasing the demand.
  D) a price decrease, decreasing the quantity supplied and increasing the quantity demanded.

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Answer to Question 1

FALSE

Answer to Question 2

B