Introduction to Economics 1 Deneme Sınavı Sorusu #1081645
Which of the following expresses a 'normative' statement?
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The government should raise the minimum wage to assure that every working individual will have ‘decent’ standards of living. |
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Raising the minimum wage by X percent will cause unemployment to increase by Y percentage points. |
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If the price increases, the demand for a normal good decreases. |
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If the price increases, the demand for a normal good increases as well. |
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If the government raises the tax on a product, this will lead to a fall in profits of the producers. |
Positive statements in economics are statements that intend to describe how things are and how things actually work. However, a normative statement is a prescriptive statement, like the ones expected to be made by a policy adviser, involving normative judgements and prescriptions about how the world should be. The answer is A.
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