Why Is It Important to Be Able to Distinguish Positive

question 80

Multiple Choice

Why is it important to be able to distinguish positive from normative statements about economic policy?

• A)Positive statements are always true and are the basis of economic policy while normative statements are false and should never be used.
• B)Positive statements help us understand the good results of a policy change, and normative statements help us understand the negative results.
• C)Positive statements help us understand the value judgements towards a particular policy, while normative statements reflect the economy's response.
• D)Positive statements help us understand the economy's response to a particular policy, while normative statements reflect value judgments.

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Definitions:

Null Hypothesis

A statement used in statistical testing that assumes no significant difference or relationship exists between specified populations.

Standard Error

The standard deviation of the sampling distribution of a statistic, commonly used to measure the precision of the sample mean estimate.

Population Average

The mean of all observations or values in a population.

Standard Error

A statistical measure that describes the accuracy with which a sample represents a population, specifically the variability of the sampling distribution.