Differentiate positive economics, normative economics, and the art of economics:

Question

(a) The unemployment rate is 6.5 percent.

(b) The unemployment rate is unacceptably high.

(c) If the government wants to reduce the unemployment rate, it might try cutting taxes.

Answer 1

Positive statement (fact): - (a) The unemployment rate is 6.5 percent.

Normative statement (judgment): - (b) The unemployment rate is unacceptably high.

Art of economics (rule-plan): - (c) If the government wants to reduce the unemployment rate, it might try cutting taxes.