Suppose someone says that a relatively small percentage of A

Suppose someone says that a relatively small percentage of Americans own a large percentage of total assets and that therefore the government should redistribute wealth to those less fortunate. Which part of that statement is normative and which part is positive, if any? Explain.

Solution

The statement that describes what ought to be or what should be are referred to as normative statements. In economic terms, normative statements deals with what ought to be or how the economic problems should be solved. These statements provides for value judgments.

On the other hand, the statements that describes things as they are or what their current situation is are referred to as positive statements. In economic terms, positive statements deals with what are the economic problems and how they are actually solved.

If we analyze the given statement then first part - \"Someone says that a relatively small percentage of Americans own a large percentage of total assets\", - describes the things as they are or what the current situation is and therefore is a positive statement.

On the other hand, the latter part - \"that therefore the government should redistribute wealth to those less fortunate\", - describes what ought to be done or what should be done and therefore is a normative statement.