Question

Explain the concept of positive and normative economics with examples.

Answer 1

Positive economics refers to the matter of the presence of the theory along with the proven facts and figures that are taken into account before developing a theory. Law of demand is an example of positive economics.

&nbps

Normative economics refers to the beliefs that support the valued judgement which is better for the nation’s economic future and for social welfare. Having a belief that the income should be distributed evenly in the economy is an example of normative economics.