Who makes investment decisions in most modern industrial ...

[bucstennis@aim.com]

Who makes investment decisions in most modern industrial societies? Discuss the roles played by firms, households, and the capital market.
 
  What will be an ideal response?

Question 2

Label each of the entries in the list as a positive or a normative statement.
 
  What will be an ideal response?

[kingfahad97]

Answer to Question 1

In most modern societies, firms primarily make investment decisions. Households decide how much to save, and the level of saving limits the amount of investment which firms can undertake. The capital market directs household savings into profitable investment projects.

Answer to Question 2

 Low-income people pay too much for housing.
The entry that low-income people pay too much for housing is a norma-tive statement.
 The number of U.S. farms has decreased over the past 50 years.
The entry about the number of farms is a positive statement.
 Toyota expands parts production in the United States.
The entry about Toyota expanding parts production is a positive state-ment.
 Imports from China are swamping U.S. department stores.
The entry about imports is a normative statement.
 The population of rural United States is declining.
The entry about the population in rural areas is a positive statement.
Use the following information to work Problems 10 to 12.
Hundreds line up for 5 p.m. Eminem ticket giveaway
Eminem fans lined up all day to get a free ticket to his secret concert at which he will release his new album Relapse (his first in 5 years).
Source: Detroit Free Press, May 18, 2009