Question

Make (a) a positive economic statement of your choice and then (b) a normative economic statement relating to your first statement.

Short answer

a) Positive economic statement: 'The unemployment rate has increased in the current financial year as compared to the previous year'.

b) Normative economic statement: "The government should introduce some investment-boosting policies to reduce the unemployment rates in the country".

Step-by-step solution

Meaning of positive and normative economic statements

When a statement is made on the basis of facts and theories, it is considered a positive statement. It accounts for actual relationships and data that are practically relevant to the economy.

On the other hand, a statement that is associated with providing opinions or conclusions is a normative statement. The statement generally includes value judgments, and it also involves suggestions.

Example of a positive economic statement

The statement, 'Unemployment rate has increased in the current financial year as compared to the previous year', focuses on the fact that prevails in a country pertaining to unemployment. Thus, it is an example of a positive economic statement because it shows a practical situation.

Example of a normative economic statement

The statement, 'The government should introduce some investment-boosting policies to reduce the unemployment rates in the country', suggests an action. Therefore, it is an example of a normative economic statement because it is reflected as a suggestion for the government to introduce some schemes to reduce unemployment.