Differentiate between a normative and positive statement. Are the following statements positive or normative.

Question: Differentiate between a normative and positive statement. Are the following statements positive or normative.

(i) Introduction of minimum-wage law causes unemployment in labour market.

(ii) The unemployment rate should be below 3%

(iii) Increase in public health expenditure will increase the overall expenditure of government

Answer:

• Positive Statements: These are objective and fact-based statements that describe how the world is. They can be tested, verified, or falsified through observation or data. Positive statements do not involve value judgments; they merely describe relationships or facts.

• Normative Statements: These are subjective and value-based statements that express opinions or beliefs about how the world should be. They involve value judgments and cannot be tested or verified objectively. Normative statements are often based on ethical, moral, or societal values.

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1. "Introduction of minimum-wage law causes unemployment in the labour market."

   • Type: Positive Statement

   • Explanation: This statement makes a factual claim about the relationship between minimum wage laws and unemployment. It can be tested and verified with data, making it a positive statement.

2. "The unemployment rate should be below 3%."

   • Type: Normative Statement

   • Explanation: This statement expresses a value judgment or opinion about what the unemployment rate should be. It cannot be tested or verified objectively, making it a normative statement.

3. "Increase in public health expenditure will increase the overall expenditure of government."

   • Type: Positive Statement

   • Explanation: This statement makes a factual claim about the relationship between public health expenditure and overall government expenditure. It can be tested and verified with data, making it a positive statement.