Question

Determine if the following items represent an example of positive economics or normative economics.The richest 1% of Americans should pay more taxes than the rest of the 99%.A decrease in the supply of coconut will increase the price of German chocolate cake, a good which requires coconut shavings as a key ingredient.The higher the minimum wage, the higher the price of goods and services is likely to be.Social welfare spending in Sweden occupies too large a portion of the national budget.

Answer 1

1. The richest 1% of Americans should pay more taxes than the rest of the 99% - Normative Economics

2. A decrease in the supply of coconut will increase the price of German chocolate cake, a good which requires coconut shavings as a key ingredient - Positive Economics

3. The higher the minimum wage, the higher the price of goods and services is likely to be - Positive Economics

4. Social welfare spending in Sweden occupies too large a portion of the national budget - Normative Economics