Microeconomics Analysis

Positive Analysis

Positive analysis is a factual statement of descriptive nature about the world identified as positive statement by the economist. However, the word “positive” does not imply only to a good facts or good news. It may include a bad news as well.

Positive analysis, like wise, utilizes principles in order to reach objectives and testable conclusion. Example “the rate of employment is presently at 10% is positive”

Normative Analysis

Normative analysis is a value based statements, on the other hand, that are prescriptive in nature are referred to as normative statements. Normative statement is a support using factual evidences, however they are not factual on their on. They include the underlying morals, standards and opinions of the people making such statement.

The process, through which people make recommendations for taking a specific standpoint or acting in a specific way is known as normative analysis. Example “The rate of unemployment is quite high”