POSITIVE STATEMENTS
Thursday, September 12, 2024 11:43 AM
Derive a set of POSITIVE STATEMENTS
1. Statement referring to “what is”
2. Free of opinion
EXAMPLE: the unemployment rate in
Canada is currently 6.1%.
Positive statements while free of opinion may not
necessarily be true.
From <https://acadiau-my.sharepoint.com/personal/0310987s_acadiau_ca/Documents/microeconomics%20lecture%
20notes%201.docx>
CHAPTER 1 Page 1
,NORMATIVE STATEMENTS
Thursday, September 12, 2024 11:43 AM
COMPARE THIS AGAINST NORMATIVE STATEMENT
• Statement referring to what "ought to be"
• Statement of opinion
Example 1.: not enough people are purchasing
electric cars
2 minimum wage is to low
NORMATIVE STATEMENTS SHOULD ALWAYS
FLOW FROM POSITIVE STATEMENTS.
CHAPTER 1 Page 2
,GAS STATION ANALYSIS
Thursday, September 12, 2024 11:53 AM
THE FURTHEST ONE HAS TO DRIVE TO GET FUEL =
0.5KM
Is this socially optimal ?
➢ 0.25 and 0.75 for a and b respectively the
furthest one has to drive to get fuel=1/4 km
➢ Therefore we may argue {i.e. make a
normative statement } that market forces also
cause people to drive too far for fuel.
➢ Example politics
CHAPTER 1 Page 3
, WHAT IS MICROECONOMICS
Thursday, September 12, 2024 12:08 PM
WHAT IS MICROECONMICS?
➢ DECISION MAKING IN LIGHT OF SCARCITY
WHO ARE THE DECISION MAKERS?
- 1 individuals/households
{or as some textbooks may say
"consumers"}
- 2 firms
{i.e. sole proprietors, partnerships,
corporations}
CHAPTER 1 Page 4
Thursday, September 12, 2024 11:43 AM
Derive a set of POSITIVE STATEMENTS
1. Statement referring to “what is”
2. Free of opinion
EXAMPLE: the unemployment rate in
Canada is currently 6.1%.
Positive statements while free of opinion may not
necessarily be true.
From <https://acadiau-my.sharepoint.com/personal/0310987s_acadiau_ca/Documents/microeconomics%20lecture%
20notes%201.docx>
CHAPTER 1 Page 1
,NORMATIVE STATEMENTS
Thursday, September 12, 2024 11:43 AM
COMPARE THIS AGAINST NORMATIVE STATEMENT
• Statement referring to what "ought to be"
• Statement of opinion
Example 1.: not enough people are purchasing
electric cars
2 minimum wage is to low
NORMATIVE STATEMENTS SHOULD ALWAYS
FLOW FROM POSITIVE STATEMENTS.
CHAPTER 1 Page 2
,GAS STATION ANALYSIS
Thursday, September 12, 2024 11:53 AM
THE FURTHEST ONE HAS TO DRIVE TO GET FUEL =
0.5KM
Is this socially optimal ?
➢ 0.25 and 0.75 for a and b respectively the
furthest one has to drive to get fuel=1/4 km
➢ Therefore we may argue {i.e. make a
normative statement } that market forces also
cause people to drive too far for fuel.
➢ Example politics
CHAPTER 1 Page 3
, WHAT IS MICROECONOMICS
Thursday, September 12, 2024 12:08 PM
WHAT IS MICROECONMICS?
➢ DECISION MAKING IN LIGHT OF SCARCITY
WHO ARE THE DECISION MAKERS?
- 1 individuals/households
{or as some textbooks may say
"consumers"}
- 2 firms
{i.e. sole proprietors, partnerships,
corporations}
CHAPTER 1 Page 4
