Which one of the following is a normative economic statement?

A. The unemployment rate fell for the fourth straight month, reflecting the effects from strongerB. Consumer prices are rising at a faster rate than in past months, indicating a renewal ofC. To help balance the Federal budget, Congress increased the tax on gasoline to its highest levelD. The worsening balance of trade must be corrected if this nation is to remain competitive in the economic growth in the second quarter inflationary pressures on the economy in the past ten years world economy

The correct answer is letter "D": The worsening balance of trade must be corrected if this nation is to remain competitive in the economic growth in the second quarter inflationary pressures on the economy in the past ten years world economy.

Explanation:

There is a significant difference between positive and normative economic statements. Positive economics sets out facts and shows no indication of bias, while normative economics incorporates subjectivity and value judgments. Both types of statements are used by economists for different purposes.

Thus, the segment:

"The worsening balance of trade must be corrected if this nation is to remain competitive in the economic growth in the second quarter inflationary pressures on the economy in the past ten years world economy";

represents a normative statement by using the modal "must" which shows bias.