Identify each of the following statements as positive or...

Identify each of the following statements as positive or normative: a) Canada is the best country in the world to live in. _________ b) Canada's national income has risen for the last five years.___________ c) If the world price of wheat rises, Canada will export less wheat.___________ d) Unemployment is a more serious problem than inflation.___________

Identify each of the following statements as positive or normative:
a) Canada is the best country in the world to live in. _________
b) Canada's national income has risen for the last five years.___________
c) If the world price of wheat rises, Canada will export less wheat.___________
d) Unemployment is a more serious problem than inflation.___________

Key Concepts

Positive Statement

A positive statement is one that can be verified or refuted by looking at real-world facts and empirical evidence. It describes what is or what will be under certain conditions without involving personal opinions, and it can be tested using data or statistical analysis.

Normative Statement

A normative statement expresses a judgment about what ought to be and reflects personal opinions or values. These statements are subjective and cannot be verified solely on the basis of observable data, as they incorporate ethical or value-based assessments.

Transcript

00:01 In this example, we're working with really just thinking like an economist in terms of positive and normative statements that can be made.

00:07 So we're given a series of statements a through e, and we want to identify which category these fall into.

00:14 But to start, let's identify or really define what positive and normative statements are.

00:20 So positive economic statements focus mainly on the facts.

00:26 Focuses on facts, on data, on statistics.

00:30 And the way things are.

00:33 That's the key part, is it focuses on just what is, essentially.

00:39 On the other hand, normative statements tend to be more general.

00:42 They may be more subjective.

00:45 They may be based upon value statements.

00:53 And again, most importantly, with normative statements as compared to the positives focus on what is, normative statements focus on what ought to be.

01:03 So it's more of a suggestion.

01:07 It's more of an implication what ought to be within society or what ought to be done.

01:13 So now that we have like just these basic definitions of the differences between positive and normative statements, let's classify which one of these each fall into.

01:21 We'll start with a.

01:23 And statement a says that a short run tradeoff between inflation and unemployment is faced by society.

01:29 So it's just saying that one thing is faced by another.

01:34 So it's just telling us something.

01:36 It's not saying that something should be different or that something ought to be a certain way.

01:41 It's just telling us what is.

01:43 So we can classify a as a positive statement.

01:47 Statement b here says that a reduction in the rate of inflation can be achieved by reducing the rate of money growth.

01:53 So again, it's not saying here that a reduction in the rate of inflation should be achieved by anyway.

01:59 It's just saying that it can't...

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