1- What are the functions and limitations of an economic model?

2- Give a brief analysis of each of the following on wages and employment:

1. A decrease in the physical risk of an occupation.
2. An increase in the demand of a product.
3. Higher-paying jobs in alternative occupations.

3- Are the following statements "positive" or "normative"?

1. Employers should not be required to offer pensions to their employees.
2. Employers offering pension benefits will pay lower wages than they would if they did not offer a pension program.
3. If further immigration of unskilled foreigners is prevented, the wages of unskilled immigrants already here will rise.
4. The military draft compels people to engage in a transaction they would not voluntarily enter into; it should therefore be avoided as a way of recruiting military personnel.
5. If the military draft were reinstituted, military salaries would probably fall.