#2.3 Positive and Normative Statements

Positive statements are based on facts, actual evidence, or observation.

Normative statements are based on opinions, beliefs, or value judgements.

Positive statements can be tested using real-world evidence.

Normative statements can always be proven to be true or false.

An example of a positive statement is: \’A fall in the supply of petrol leads to an increase in its price.\

An example of a normative statement is: \’An increase in government spending is the best way to boost the economy.\

Positive statements express value judgements within their analysis.

Economists make only normative statements when analyzing the economy.

The key difference between positive and normative statements is that positive statements are testable while normative statements are subjective.

Normative statements help economists avoid making value judgements.

When an economist expresses an opinion, the statement becomes normative.

Positive and normative statements can never be distinguished from one another.

Understanding the difference between positive and normative statements allows for better economic analysis.

Economists never use normative statements in their analysis.

A statement that says \’The price of onions should increase due to prolonged drought\’ is a positive statement.

A statement that says \’The price of onions increases due to prolonged drought\’ is a normative statement.

Normative statements play no role in economic discussions.

Economists strive to remain objective when making positive statements.

Economic analysis can be improved by differentiating between positive and normative statements.

Normative statements provide factual descriptions of economic issues.