What is the difference between macroeconomics and microeconomics? Give an example of a question that a macroeconomist might be interested in answering, then do the same for a microeconomist
Macroeconomics is the branch of economics that looks at human behavior and choices as they relate to the entire economy. Microeconomics deals with human behavior and choices as they relate to relatively small units ---an individual, a firm, an industry, a single market. A macroeconomist would be concerned about questions that impact the whole economy such as, "How will the proposed tax cut affect unemployment, inflation and economic growth?" A microeconomist would ask questions that relate to the various parts that make up the economy such as, "How will the drought impact the price of corn?"
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Nominal GDP is calculated by using
A. prices set in a base year. B. average prices in all major cities. C. current prices. D. prices charged by initial producers.
The stored value of money over time should not change significantly as long as the level of inflation is
A) low. B) less than your pay increases. C) high. D) adjusted by the government.
When an economy produces at its allocatively efficient production point
A) scarcity is not a problem. B) resources are not limited. C) a society can increase the production of all goods. D) a society can increase the production of one good only by decreasing the production of some other good that is valued more highly.
Customs unions and free trade areas are identical in the manner in which member countries treat imports from nonmember countries
Indicate whether the statement is true or false