Final answer:
True, the branch of economics that deals with subjective opinions on how the world should be is known as normative economics. It contrasts with positive economics, which is concerned with factual and testable statements about the world as it is.
Step-by-step explanation:
The main answer to the student's question is true. The branch of economics that deals with prescriptions about how the world should be is indeed called normative economics. Normative statements are subjective and reflect opinions based on individual or societal values. Unlike positive statements, which are testable and factual, normative statements cannot be tested or proven true or false because they are based on opinions and judgments about what is desirable or ideal, not what is empirically observable.For example, an economist may assess a policy such as a proposed subway system, and from a positive economics perspective, analyze whether the expected benefits outweigh the costs. This is a factual assessment. Conversely, if an economist suggests that a country should provide extended unemployment compensation because it is morally right to support the less fortunate, this course of action would be an expression of normative economics.