Positive Economics
Positive economics focuses on economic phenomena and describes and explains those phenomena.
Positive economic statements are descriptive and precisely measurable.
Example Of Positive Economics
Government raises taxes to increase its revenue.
Normative Economics
Normative economics emphasizes on value judgment for the development of various economic activities.
Normative economics deals with what will and should be.
Example Of Normative Economics
If the government wants to increase the disposable income of the people then it has to reduce the tax and if government wants to increase the revenue then it has to increase the tax.
Positive VS Normative Economics
Positive Economics describes economic phenomena .It gives no opinion and Normative Economics gives opinion on various economic activities . Positive Economics Is Descriptive and Normative Economics is Prescriptive.
Positive economics analyze the relationship between cause and effect of economics activity .
Positive Economics deals how economic problems are solved.
Normative Economics Gives the subjective ideas and Normative Economics describe how economic problem should be solved.
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