Differentiate between positive and normative economics using ...

[burchfield96]

Differentiate between positive and normative economics using examples.
 
  What will be an ideal response?

Question 2

Which of the following is true of long-run equilibrium price in a monopolistically competitive market?
 
  A) It is equal to average total cost.
  B) It is less than average total cost.
  C) It is higher than average total cost.
  D) It is lower than marginal cost.

[janieazgirl]

Answer to Question 1

Positive economics is analysis that generates objective descriptions or predictions about the world that can be verified with data. It is analysis that describes what people actually do. A 5 fall in the unemployment rate will lead to a 2 increase in the inflation rate is an example of a positive economic statement. Normative economics, on the other hand, is analysis that prescribes what an individual or society ought to do. It is subjective and depends on personal preferences, tastes, attitudes, feelings, or ethical judgments. Pollution in developing countries is one of the biggest global environmental problems is an example of a normative economic statement.

Answer to Question 2

A

[burchfield96]

YES! Correct, THANKS for helping me on my review

[nathang24]

Thanks for the timely response, appreciate it