Which of the Following Statements Correctly Highlights the Difference Between

question 66

Multiple Choice

Which of the following statements correctly highlights the difference between microeconomics and macroeconomics?

• A) Microeconomics is descriptive, whereas macroeconomics is advisory.
• B) Microeconomics primarily deals with positive analysis, whereas macroeconomics primarily deals with normative analysis.
• C) Microeconomics deals with a small part of the economy, whereas macroeconomics deals with aggregate economic performance.
• D) Microeconomics describes what economic agents actually do, whereas macroeconomics describes what economic agents ought to do.

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Definitions:

Finance

The management of large amounts of money, especially by governments or large companies, including the processes of investing, borrowing, lending, budgeting, saving, and forecasting.

Stocks and Bonds

Financial instruments that represent ownership in a company (stocks) and debt obligations (bonds), respectively, offering different levels of risk and potential returns.

Cash Flows

The aggregate sum of funds flowing in and out of a company, significantly influencing its ability to meet short-term obligations.

Expected Cash Flows

The anticipated stream of cash payments or receipts over a given period, used in evaluating investments or business projects.