1.1.2 Positive and Normative Statements
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6 Terms
What is positive economics?
Economics concerned with objective statements of how a market or economy works
What are positive economic statements based off of
Empirical evidence- can be proven true or false
What is normative economics focused on?
Focused on value judgements built around opinions and beliefs as to what the best economic policies or solutions may be
Wat is the role of value judgements?
to influence an individuals choices in the economic decisions they make (caused by where they live, what they eat, where they work etc)
To influence governments choices in regards to the economic policies they choose to adopt and spend money on
Why are most economic decisions made by individuals or governments normative
because they are based off of value judgements
Why is economic analysis positive
Because they are based on empirical evidence