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:

Domestic Supply

The total amount of a product or service produced within a country, available for consumption or export within its borders.

Domestic Demand

The total demand for goods and services within a country, excluding external trade.

World Price

The price at which goods are traded internationally, determining how much a product costs across different countries.

Free Trade

Free trade is the unrestricted exchange of goods and services between countries without tariffs, quotas, or other trade barriers.