Question

In a single sentence, contrast microeconomics and macroeconomics. Next, categorize each of the following issues as a microeconomic issue, a macroeconomic issue, or not an economic issue. (See page 3.) a. The national unemployment rate b. The decision of a worker to work overtime or not c. A family's choice to have a baby d. The rate of growth of the money supply e. The national government's budget deficit f. A student's allocation of study time across two subjects

Answer 1

Answer:

a. Macroeconomics

b. Microeconomics

c. Not an economic issue

d. Microeconomic

e. Macroeconomic

f. Not an economic issue

Explanation:

Microeconomics is the kind of economics, which deals with the study of the decision making, that is undertaken by the firms or the individuals. Whereas the Macroeconomics is also kind or type of economics, which deals with the study of behavior of the whole economy.

a. Rate of national unemployment- It dealt with the economy as a whole. So, it is concerned with the Macroeconomics.

b. Decision of worker to work overtime - It deal with the decision making of the worker. So, it is concerned with the Microeconomics.

c. Choice of family having a baby - It is related to the family, it will not be considered as an economic issue.

d. Growth rate of the money supply - It deal with the decision making of the money supply. So, it is concerned with the Microeconomics.

e. Budget deficit - It dealt with the economy as a whole. So, it is concerned with the Macroeconomics.

f. Student allocation of study -  It is related to the student life, it will not be considered as an economic issue.