Economists Use ____ Economic Analysis to Understand an Individual Market

question 139

Multiple Choice

Economists use ____ economic analysis to understand an individual market. They then use ____ economic analysis to guide future national economic policy.

• A) b and d
• B) macro; micro
• C) positive; normative
• D) normative; positive

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Definitions:

Market Economies

Economic systems in which supply and demand drive the production and pricing of goods and services, with minimal government intervention.

Price Ceiling

A government-imposed limit on how high a price can be charged for a product or service, aimed at preventing prices from reaching levels deemed too high for consumers.

Quantity Demanded

The total amount of a good or service that consumers are willing and able to purchase at a given price level, at a specific time.

Black Market

An illegal market where goods or services are traded without compliance with legal requirements, often including the sale of illicit goods.