Which of the following is an example of a normative economic statement?
A) Lower income tax rates will generate greater income tax revenue to the government.
B) Income tax rates should be lower because that will increase government revenue.
C) Lower income tax rates yield a larger federal government deficit.
D) The federal budget deficit has increased every year for the last twenty years.

Question

Quizplus · Accepted Answer

A normative economic statement expresses a value judgment about what ought to be, rather than a factual statement about what is. Option B expresses a normative judgment about what tax rates should be, while the other options are factual statements (A and D) or express a causal relationship (C).

Which of the Following Is an Example of a Normative