Which of the following statements is an example of normative economics?
A)The rich are getting richer and the poor are getting poorer.
B)The Justice Department has ruled that Microsoft is a monopoly.
C)The federal government should allocate more of its budget toward education programs.
D)All of the statements above represent examples of normative economics.
E)None of the statements above represent examples of normative economics.

Question

Quizplus · Accepted Answer

Normative economics involves making value judgments or recommendations about what should be done, rather than describing a situation or making predictions. The statement "The federal government should allocate more of its budget toward education programs" is an example of normative economics because it is suggesting what should be done. The other statements are examples of positive economics because they describe a situation or make a statement of fact.

Which of the Following Statements Is an Example of Normative