Which of the following is an example of a normative economic statement?
A) The inflation rate in the United States decreased 4 percent because the price of energy fell.
B) The economy grew at an annual rate of 5 percent during the first quarter of this year.
C) If two automobile companies merge, the price of automobiles will rise.
D) An increase in international trade benefits some workers but hurts others.
E) The minimum wage should be increased so that low-income workers can afford to keep up with the cost of living.

Question

Quizplus · Accepted Answer

Normative economic statements are opinions that prescribe what should be done. They involve value judgments and cannot be tested or proven. Option E ("The minimum wage should be increased so that low-income workers can afford to keep up with the cost of living.") is a normative statement because it expresses an opinion on what economic policy should be pursued.

Which of the Following Is an Example of a Normative