TYPES OF UTILITY APPROACH

Last time I have discussed about the concept and nature of utility. Today I will discuss about the Types OF UTILITY APPROACH.

Utility approach is basically of 2 following types: Continue reading “TYPES OF UTILITY APPROACH”

Difference between positive economics and normative economics

Last time we have discussed the types of economics. Today we will discuss the difference between positive economics and normative economics. Let us discuss it:

POSITIVE ECONOMICS:  

It deals with the economic issues of past, present and future and tells about what was, what is, what would be. Positive economics is basically based on the facts and figures which can be verifiable.

For example India is the second largest populated country; it is a positive statement nobody can deny it as it is based on the facts and figures.

NORMATIVE ECONOMICS:

It deals with the opinions of economists related to the economic issues and tells about what ought to be. Normative economics is basically based on the opinions which can’t be verifiable. For example there should be the development industries in underdeveloped countries to make them developing countries. So this statement is just an opinion and it is just a judgment.

I hope you have understood the difference between positive economics and normative economics.

Types of Economics

The term economics is very common and Economics can be broadly classified into two parts:

MICRO ECONOMICS: in microeconomics we study “I” which means individual. It means in micro economics we study everything from the point of view of individual. The word micro itself means small. In micro economics we study individual firm, individual producer, individual consumer etc. Continue reading “Types of Economics”