The Branch of Economics Which Studies How Households and Firms

question 82

Multiple Choice

The branch of economics which studies how households and firms interact in markets is called

• A)macroeconomics.
• B)microeconomics.
• C)positive economics.
• D)normative economics.

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Definitions:

Contribution Format

A form of income statement that distinguishes costs by classifying them into variable and fixed sections, thereby focusing on the contribution margin.

Contribution Margin Ratio

A ratio that measures the difference between the sales and the variable costs of a product or service, as a percentage of sales.

Cement Manufacturer

A business involved in the production and sale of cement, a key ingredient in concrete.

Margin Of Safety

The difference between the actual or expected profitability of a project and the break-even point, often used as a risk assessment measure.