Question

Find the odd statement out.

• A. Normative economics is concerned with welfare propositions.
• B. Normative economics is prescriptive in nature.
• C. Normative economics is regulatory in nature
• D. Economic laws are hypothetical.

Answer 1

Answer: (D)

Economic laws are hypothetical.

Economic laws are not hypothetical in nature, while many microeconomic models may involve many assumptions and tend to over simplify situations, the broad theories are still valid in the real world, it has been proven time and again with empirical data.

Normative economics deals with subjective economics, and are grounded in personal opinions rather than empirical facts. They tend to be prescriptive and regulatory in nature (ie, they contain advice on what should be done to solve a particular problem).