Question

Which of the following is an example of a positive, as opposed to normative, statement?  A. Inflation is more harmful to the economy than unemployment is.  B. If welfare payments increase, the world will be a better place.  C. Prices rise when the government prints too much money.  D. When public policies are evaluated, the benefits to the economy of improved equality should be considered more important than the costs of reduced efficiency.

Answer 1

Answer: Option (C) is correct.

Explanation:

Positive view of the economy theory is largely based on the facts and incentives and it is engaged with most of the assumptions and check these assumptions reality to prove the facts.

On the other hand, normative view of economic theory is largely based on the statements, it is subjective and engaged with the value of the incentive or fact.