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Economics Test Out Practice Test

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If an economist states the unemployment rate is 5% without judging whether that rate is good or bad, which approach is this?
Correct Answer:
Positive economics
Explanation:
Stating the unemployment rate as a factual figure without judging whether it’s good or bad is an example of positive economics. Positive economics describes and analyzes economic conditions as they exist, using data and evidence, without making value judgments. Normative economics would involve evaluating whether a 5% rate is desirable or acceptable. The other terms aren’t about the method: economics is the broad field, and economy refers to the system itself. So this is positive economics.

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