Question

Determine whether each of the following are positive or normative statements.

1. Higher education is a contributing factor to economic growth.

2. Environmental regulations increase production costs.

3. Tax cuts for middle income families are more beneficial to our economy than corporate tax cuts.

Please help!!!

Answer 1

Answer - Statement 1 and 2 are positive economics statement and statement 3 is normative economics statement.

Reason -

positive economics is fact based economics which expresses the facts as it happened or as it is. It does not apply any further judgement or opinion to the statement and represents the fact as it is.

1) Higher education is a contribution factor to economic growth is a positive economics statement as its giving the fact in a simple sentence without any interpretation of it.

2) environment regulation increase production cost is a positive economics statement as well, as it provides fact expressing that environment regulation are increasing production costs but it's not giving any comment on it or not expressing any judgements.

Normative economics is judgement based economics. It provides the fact as well as the outcome or effect of it. It expresses how things should be and not only how they are. It provides opinions on the facts presented.

3) Tax cuts for middle Income families are more beneficial to our economy than corporate tax cuts is a normative economics statement as its giving an opinion that the tax cuts are better to be done for middle Income families, instead of only presenting the facts.

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