If John says the price of gasoline is too high and Paul says prices are determined by the action of the marketplace, then John has made a(n):
A) positive economic statement, and Paul has made a normative economic statement
B) positive economic statement, and Paul has made a positive economic statement
C) normative economic statement, and Paul has made a normative economic statement
D) normative economic statement, and Paul has made a positive economic statement
E) improper economic statement, and Paul has made a proper economic statement

Question

Quizplus · Accepted Answer

John's statement is normative because it reflects a value judgment about what ought to be. Paul's statement is positive because it describes how the economy operates without making a judgment.

If John Says the Price of Gasoline Is Too High