C)The government should increase tax rates and revenues to reduce the budget deficit. D) All of the above statements are normative statements. Economics seeks to describe economic behavior as it actually exists, and it relies on a distinction between positive statements, which describe the world as it is, a nd normative statements, which describe how the world should be.. It is normative because it is based on your subjective opinion. a. For instance, "the world … B. Which of the following would be an example of a normative statement? Which of the following is a normative economic statement? Positive and normative economics can be identified as two major branches of economic reasoning. answer. a) California's new minimum wage is $10 per hour is too high. Video Transcript. Which of the following is a normative economic statement? U nderstanding how to recognize a normative statement is a very important skill to have when you are trying to pass your economics class. A normative statement explains what should be base of the subject according to the belief through valued judgement that describes the fairness of the subject on public policy. answer. This Site Might Help You. 13) Which of the following is a normative economic statement? If the price of a product decreases, quantity demanded increases. Which of the following is an example of a normative statement? Government has grown too large and should be reduced.2. It would help millions of people by increasing their disposable incomes.” 18. Thus it is suggestive in nature. d. An increase in minimum wages will increase unemployment. If we doubled the size of welfare payments, we would reduce the number of homeless persons. A normative economic statement expresses a cake judgement about how something should be. As you can deduce from this statement, it … b. b) Reapid rates of economic growth can lead to environmental damage c) During a recession, unemployment rates Rise d) The government should keep inflation from rising. Which of the following is a normative economic statement? Normative theory positive theory Positive Accounting Positive economic theory and accounting practices are objective and based on factPositive accounting focuses on analyzing the economic statistics and data at hand, and deriving conclusions based on those figures. (a) Planned economies allocate resources via government departments. question. Normative Economics: This move will increase the purchasing power of all citizens and they would be able to facilitate the economic growth of the country. Normative economic statements are an approach to economics that analyzes outcomes of economic behavior, evaluates them as good or bad, and may prescribe a course of action. A) Next year's inflation rate will be under 4 percent. RE: Which of the following is a normative statement? Do you think people tailor their behavior to suit those in power more than they admit? Which of the following is a normative statement? answer. Normative statements usually present an opinion-based analysis in terms of what is considered desirable. Normative statements are subjective statements – i.e. They should pay their own way. In many disciplines, including economics and philosophy, a normative statement expresses a value judgment about whether a situation is desirable or undesirable. C) The government's cuts in welfare spending impose an unfair hardship on the poor. Reducing tax rates on the wealthy would be good for the country. A) The rich do not pay their fair share and should pay more in taxes. Imagine we are looking at scenarios in which the government reduced income taxes by 50%: – A Normative Economic Statement may include the following words: “The government should reduce income tax by 50%. Therefore, the unemployment rate should be lowered is a valued judgement based on the belief that it will bring economic welfare. Which of the following is a normative economic statement? C. If the national saving rate were to increase, so would the rate of economic growth. a. An example of a normative economic statement is: "The government should provide basic healthcare to all citizens." Chapter 1 Macroeconomics Answers; Generally, economists try to avoid making too many normative statements because they view them as closer to being in the realm of political science and are typically unable to be found to be true or false using traditional hypothesis testing. c. An increase in spending on airport security will reduce the number of hijackings. asked Aug 21, 2020 in Economics by Taken. Normative statements are subjective statements – i.e. A) Tobacco products should be banned in all public spaces. Related Flashcards. a. Savings accounts earn interest, whereas checking accounts do not. Whereas a descriptive statement (also known as a positive statement) is meant to describe the world as it is, a normative statement is meant to talk about the world as it should be. In this video, learn about the distinction between positive statements and normative statements, and why economists emphasize positive analysis vs. normative analysis, as well as how to identify positive statements vs. normative statements. In the following, I summarize the characteristics of the normative statement: Positive Statements. b. Positive statements are fact-based, but normative statements are based on opinions. asked Dec 19, 2019 in Economics by andreipl93. Government spends Rs. Natural Resources - Sustainable Development: 29. B) With rising mortgage rates and rising unemployment rates, the number of unsold homes has The money supply grew by 3% last year. For example, if corporate growth allows a company to increase shareholder dividends over … A positive economic statement C. Loaded terminology D. Two kinds of assertions in economics can be subjected to testing. (b) Most transitional economies have experienced problems of failing output and rising prices over the past decade. Hey, everyone, today we're going through problems six from Chapter one of the textbook, which basically asks us to give an example of a positive economic statement and then give another example of a normative economic statement that relates to the content of the positive economic statement. Next year's inflation rate will be under 4%. (c) There is a greater degree of consumer sovereignty in market economies than planned economies. a) a higher price of oil means that people will buy less. d. continually train to stay up to date on information technology developments. Video Transcript. Which of the following is a normative economic statement. B) Consumers will buy more gasoline over the Christmas holiday even if the price of gas is 10 cents higher than it was during the Thanksgiving holiday. (1) Which of the following is a normative statement? Which phrase is associated with normative statements. It discusses what the desirable things are and how they should be realized. Which of the following is a normative statement? Normative statement. A) Rising global demand for coal has led to increases in the price of coal. B) The increase in tobacco taxes has caused an increase in the price of cigarettes. To check inflation RBI should restrict money supply. a. Debit balance with Binodjournal plz … The rate of inflation has increased.3. B) The poor do not deserve welfare. b. Companies should be concerned with more than just their profits. A) Falling global demand for pesticides has led to decreases in the price of pesticides. Which of the following is a normative economic statement? In economics, the normative statement refers to the statement that makes a value judgment that is an option of the speaker. d. Which of the following is a normative statement?1. These national income option B Law X is a good piece of legislation auctioned. ; The government is right … they carry value judgments.For example: Pollution is the most serious economic problem; Unemployment is more harmful than inflation; The congestion charge for drivers of petrol-guzzling cars should increase to £25; The government should increase the minimum wage to £7 per hour to reduce poverty. The statement in a newspaper that "consumer prices rose last month by 1 percent, and if this trend continues, the annual rate of inflation will be 12 percent for the year" is an example of: A. For example, you stated that Indonesia’s economic growth should increase to 6%. A normative economic statement B. c) the current high price of gasoline is the result of strong worldwide demand. Which of the following is a normative statement? The U.S. rate of unemployment was lower in 2004 than it was in 1994. b. okay on this question were asked which the following is a positive matter than a normative statement Option. While P ositive economics is based on the development and practicing of positive statements about the world economy which is objective and provable, normative economy can be defined as an opinion, estimation or a point of view. A. 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