Multiple Choice
Economic policy must strike a balance between ideals and which of the following?
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0. Basic Principles of Economics
Positive and Normative Analysis
Multiple Choice
The excerpt most directly expresses an economic perspective that:
A
emphasizes the desirability of certain market outcomes
B
advocates for a specific policy based on ethical considerations
C
describes what is, without making value judgments
D
focuses on the fairness of income distribution
Verified step by step guidance1
Identify the nature of the economic perspective described in the excerpt by distinguishing between positive and normative economics. Positive economics describes what is, focusing on objective analysis without value judgments, while normative economics involves opinions about what ought to be, often including ethical considerations.
Analyze the options given: 'emphasizes the desirability of certain market outcomes' and 'advocates for a specific policy based on ethical considerations' both suggest normative economics because they involve value judgments about what should happen.
Consider the option 'describes what is, without making value judgments' as an example of positive economics, which aims to explain economic phenomena objectively without prescribing policies or ethical stances.
Evaluate the option 'focuses on the fairness of income distribution' which typically involves normative judgments about equity and justice, thus falling under normative economics.
Conclude that the excerpt most directly expresses a positive economic perspective if it avoids value judgments and focuses on describing economic realities as they are.
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