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The statement that Business Economics combines both positive and normative theory, with the emphasis being more on one of them, implies the greater emphasis is on the:
ANormative aspect
BPositive aspect
CMacroeconomic aspect
DStatistical aspect
Answer & Solution
Correct answer: A. Normative aspect
1. Business Economics blends positive and normative economics.
2. To form valid decision rules it needs positive (descriptive) understanding of the environment.
3. Yet the unit states the emphasis is more on the normative (prescriptive) side.
4. Hence the normative aspect carries the greater emphasis.
5. Trap B: the positive aspect reverses the stated emphasis, so it is wrong.
6. Traps C and D: macroeconomic and statistical aspects are not the positive/normative pairing being weighed here.
_Source: ICAI BoS CA Foundation Paper 4 Business Economics, Ch 1 Unit I "Nature and Scope of Business Economics", p.6_
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