Which of the following statements belongs more properly in the field of normative economics than positive economics?
A)An increase in the minimum wage leads to more unemployment.
B)The price of one Canadian dollar is $0.85 U.S.
C)When a drought occurs,the price of vegetables tends to rise.
D)Canadian governments should provide assistance to the auto industry.
E)Technological change has reduced the cost of cell phone service.

Question

Quizplus · Accepted Answer

Normative economics deals with value judgments and opinions on what should be done rather than what is. Statement D is a normative statement as it suggests a policy recommendation for the government to provide assistance to an industry. The other statements are positive statements that describe what is or what may happen based on observable data or economic theory.

Which of the Following Statements Belongs More Properly in the Field