Tag: microeconomics and macroeconomics : introduction

Questions Related to microeconomics and macroeconomics : introduction

The branch of economic theory that deals with the problem of allocation of resources is ________________.

business economics and quantitative methods introduction to micro economics microeconomics and macroeconomics : introduction economic ideas of j k mehta micro and macro economics

  1. Micro economic theory

  2. Macro economic theory

  3. Econometrics

  4. None of the above

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Correct Option: A
Explanation:

Micro economics deals with the individual problems of production which involves cost and production function. Therefore, allocation of resources is a part of this branch.

A study of how an increase in the corporate income tax rate will affect the national unemployment rate is an example of:

business economics and quantitative methods introduction to micro economics microeconomics and macroeconomics : introduction economic ideas of j k mehta micro and macro economics

  1. Macro economics

  2. Descriptive economics

  3. Micro economics

  4. Normative economics

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Correct Option: A
Explanation:

Macroeconomics deals with all the issues affecting the national economy.


For example, an increase in the direct tax such as corporate income tax will increase the cost of the corporate sector. 

Thus, in order to compensate their costs, one of the measure may be to lessen the employees which will further affect the unemployment in the economy.

Micro and Macro Economics were coined by ________during the twenties, and since then they are frequently used by economists for economic analysis.

business economics and quantitative methods introduction to micro economics microeconomics and macroeconomics : introduction economic ideas of j k mehta micro and macro economics

  1. Prof. Keynes

  2. Prof. Robbins

  3. Prof. Marshall

  4. Prof. Ragner Frisch

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Correct Option: D
Explanation:

Prof. Ragnar Frisch was a Norwegian economist who was best known for founding the various disciplines of econometric and for coining the two common terms i.e. micro and macro economics which is the most widely used terms in modern economics.

__________ may be defined as that branch of economic analysis which studies the behaviour of all the units combined together.

business economics and quantitative methods introduction to micro economics microeconomics and macroeconomics : introduction economic ideas of j k mehta micro and macro economics

  1. Microeconomics

  2. Macroeconomics

  3. Individual economics

  4. Household economics

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Correct Option: B
Explanation:

Macroeconomics is the branch of economics that studies the aggregate units of the economy like national income, employment, etc. It uses lumping method for the purpose of economic study. For example, under lumping method we study the general price level that is prices of all products, and not prices of individual products.

________is a study in aggregates.

business economics and quantitative methods introduction to micro economics microeconomics and macroeconomics : introduction economic ideas of j k mehta micro and macro economics

  1. Macro economics

  2. Micro economics

  3. Both (a) and (b)

  4. Social economics

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Correct Option: A
Explanation:

Macro economics deals in the study of a nation's aggregate demand, aggregate supply, national income, aggregate employment and unemployment , inflation etc. Therefore, it studies group variables and not individual variables. 

We mainly study the following in macro economics-
I. National income and output
II. General price level
III. Balance of trade and payments
Select the correct answer from the options given below -

business economics and quantitative methods introduction to micro economics microeconomics and macroeconomics : introduction economic ideas of j k mehta micro and macro economics

  1. I & II

  2. II & III

  3. I & III

  4. All of the above

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Correct Option: D
Explanation:

Macroeconomics studies economic relationships or economic problems or economic issues at the level of the economy as a whole. Thus national income and output, general price level and balance of trade and payments- all are studied under macro economics since they all involve the study of the economic aggregates.

The publication of______General Theory, in 1936, gave a strong impetus to the growth and development of modern macro economics.

business economics and quantitative methods introduction to micro economics microeconomics and macroeconomics : introduction economic ideas of j k mehta micro and macro economics

  1. Keynes

  2. Robbins

  3. Marshall

  4. Ragner Frisch

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Correct Option: A
Explanation:

Keynes general theory focused on income and employment of the nation which affects aggregate demand and supply of the nation which was the main branch of macro economics after national income.

We mainly study the following in Macro-Economics: 

business economics and quantitative methods introduction to micro economics microeconomics and macroeconomics : introduction economic ideas of j k mehta micro and macro economics

  1. External value of money

  2. Consumer behaviour

  3. All (A), (B) & D)

  4. Location of industry

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Correct Option: A
Explanation:

Macro economics has a separate branch known as exchange rate systems that deals in the study of external value of money in comparison to the domestic currency and how these fluctuations affects a nation's growth and development. 

We mainly study the following in Micro-Economics:

business economics and quantitative methods introduction to micro economics microeconomics and macroeconomics : introduction economic ideas of j k mehta micro and macro economics

  1. General price level

  2. National income and output

  3. Location of industry

  4. Employment and economic growth

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Correct Option: C
Explanation:

In micro economics, summation of various similar markets form an industry which is located at various places according to the required resources available there and demand and supply of the commodities prevailing there. 

Microeconomics and macroeconomics are not independent approaches to economic analysis but they are complementary to each other.

business economics and quantitative methods introduction to micro economics microeconomics and macroeconomics : introduction economic ideas of j k mehta micro and macro economics

  1. False

  2. True

  3. Partly true

  4. Partly false

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Correct Option: B
Explanation:

Micro and macro approaches of economics are very dependent on each other. To know well about the working of an economy, on must have knowledge of both the branches of economics. It can be said that macroeconomics uses the principles of microeconomics as its foundation and the former is a magnified version of the latter.