2. Define normative and positive economics and then explain why each of the following statements
below, 2a through 2d, represents either a positive economic statement or a normative economic statement:
2a. As the minimum wage rate rises from $10 an hour to $15 an hour in California, the unemployment rate rises from 5% to 8%.
2b. The state of New Hampshire ought to spend more money in their budget this year on putting more state parks.
2c. A 25 percent increase in the price of oil to make gasoline increased the prices of gasoline by 50 percent nationwide.
2d. The Federal Reserve System should raise interest rates to combat inflation in the United States.
Positive economics refers to the stream of economics which centers on quantification, explanation, and description of the... View the full answer