The Difference Between Positive Economic Statements and Normative Economic Statements

question 88

Multiple Choice

The difference between positive economic statements and normative economic statements is that:

• A)positive statements are based on opinion while normative statements are always true.
• B)positive statements are based on opinion while normative statements are based on fact.
• C)positive statements are true and normative statements are often false.
• D)positive statements are often false and normative statements are true.
• E)positive statements are based on fact while normative statements are based on opinion.

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Definitions:

Flexible Exchange-rate System

An exchange rate regime in which a currency's value is allowed to fluctuate according to the foreign exchange market.

European Euro

The official currency used in 19 of the 27 European Union countries, known as the Eurozone.

Rate of Exchange

The price of one country's currency expressed in terms of another country's currency, facilitating international trade and investment.

Supply and Demand Curves

Graphical representations that show the relationship between the prices of goods and services and their quantities supplied and demanded in the market.