contestada

Categorize each of these statements as either positive or normative.

a. Taxes are too high.
b. In some circumstances, if taxes are lowered, government revenues actually increase.
c. It is immoral for a government to redistribute money from one person to another.
d. When the government increases taxes, rates of tax evasion increase.

Respuesta :

Answer:

Positive = b. In some circumstances, if taxes are lowered, government revenues actually increase.

d. When the government increases taxes, rates of tax evasion increase.

Normative : a. Taxes are too high

c. It is immoral for a government to redistribute money from one person to another.

Explanation:

Positive Economics is objective and statements are usually based on facts and economic theory. They can be tested.  

For example, an increase in input would lead to a decreases in supply of the good is based on economic theory and facts. An increase in input would increase the cost of production and this would discourage sellers from producing.  

Normative economics s based value judgements, opinions and perspectives. For example, the statement - social welfare spending in Sweden occupies too large a portion of the national budget - is based on opinion. To some the expenditure might be even too small. There is no economic theory that can be used to determine if this expenditure is too large or small

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