POSITIVE AND NORMATIVE STATEMENTS
POSITIVE STATEMENTS
A positive statement is one which can be veri ed by facts.
They can be checked against evidence and proved correct
or incorrect.
Examples:
• The structure of the business has been simpli ed.
• The airport is highly competitive bit there is spare
capacity.
• If rms raise prices, pro ts will rise.
They can be veri ed against facts as true or false.
NORMATIVE STATEMENTS
A normative statement is based on value judgement.
It is subjective as it depends on one’s opinion.
Examples:
• The government should not increase taxes on spending
because economic welfare will decrease.
• We should concentrate on improving the use of existing
capacity not build another runaway.
• The business has fallen behind competitors and needs to
improve its ethical standards.
They indicate preferences.
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POSITIVE STATEMENTS
A positive statement is one which can be veri ed by facts.
They can be checked against evidence and proved correct
or incorrect.
Examples:
• The structure of the business has been simpli ed.
• The airport is highly competitive bit there is spare
capacity.
• If rms raise prices, pro ts will rise.
They can be veri ed against facts as true or false.
NORMATIVE STATEMENTS
A normative statement is based on value judgement.
It is subjective as it depends on one’s opinion.
Examples:
• The government should not increase taxes on spending
because economic welfare will decrease.
• We should concentrate on improving the use of existing
capacity not build another runaway.
• The business has fallen behind competitors and needs to
improve its ethical standards.
They indicate preferences.
fi
fi fi fi
fi
