Question:
Which of the following statements is a normative statement?
(1) Increasing fuel prices will encourage the demand for electric cars.
(2) If income increases, sales of luxury goods will fall.
(3) As laptop prices fall, people will buy more of them.
(4) Government should control the rents that house-owners charge.
(5) The quantity demanded of a good is inversely related to changes in its price.
Correct Answer:
(4)
Answer Explanation:
Normative statements are subjective and based on value judgments about what “ought to be” or what “should” happen. Option 4 uses the word “should,” indicating an opinion rather than a testable fact. The other options are positive statements that can be proven true or false.
Topic: Introduction Year: 2018
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