In microeconomics, what is the term used when making predictions about data or outcomes that have not yet been observed or recorded?

• A. Normative analysis
• B. Positive analysis
• C. Descriptive analysis
• D. Prescriptive analysis

Answer: (B)

Verified step by step guidance

1. Understand the difference between the types of economic analysis: Normative analysis involves value judgments about what ought to be, while Positive analysis focuses on objective statements and predictions about what is or will be.
2. Recognize that making predictions about data or outcomes that have not yet been observed involves stating what is expected to happen based on current information, without involving opinions or prescriptions.
3. Identify that Descriptive analysis refers to summarizing or describing existing data rather than predicting future outcomes.
4. Note that Prescriptive analysis involves recommendations or advice on what actions should be taken, which is different from merely predicting outcomes.
5. Conclude that the term used for making predictions about unobserved or future data in microeconomics is Positive analysis, as it deals with factual, testable statements about the economy.