Which of the following is an example of normative economics?
A) The city of Portland has one of the highest rates of homelessness in the nation.
B) The trade deficit hit an all-time high last month.
C) Unemployment benefits in France are too generous and create a drain on government budgets.
D) A higher subsidy for public transportation will likely reduce traffic congestion and improve air quality in our cities.

Question

Quizplus · Accepted Answer

Normative economics involves value judgments or opinions about what ought to be, rather than statements of fact. Choice C, stating that unemployment benefits in France are "too generous" and create a drain on government budgets, is an example of a normative statement because it reflects a judgment about the level of benefits and their impact.

Which of the Following Is an Example of Normative Economics