LS4 - Normative and Positive Economic Statements Flashcards
1
Q
What does objective mean?
A
Something that is based on real facts and not influenced by personal beliefs
2
Q
What does subjective mean?
A
Something that is based on personal beliefs
3
Q
What is a positive economic statement?
A
A statement which can be proven true or false and is objective
4
Q
What is a normative economic statement?
A
A subjective statement which expresses opinions and therefore cannot be proven as true or false
5
Q
What are typical words you would expect to see in a normative economic statement?
A
Ought, should, better, worse, fair, unfair
6
Q
What is positive economics?
A
The objective study of the allocation of resources
7
Q
What is normative economics?
A
The study of policy prescriptions using value judgements about how scarce resources are allocated
