Question

Define Normative Economics with Suitable Example.​

Answer 1

Answer:

An example of a normative economic statement is as follows: ... The price of milk should be $6 a gallon to give dairy farmers a higher living standard and to save the family farm. This is a normative statement, because it reflects value judgments.

Answer 2

Normative economics focuses on the value of economic fairness, or what the economy "should be" or "ought to be." While positive economics is based on fact and cannot be approved or disapproved, normative economics is based on value judgements.