Both Microeconomic and Macroeconomic Theories

question 63

Multiple Choice

Both microeconomic and macroeconomic theories:

• A)clearly state the public policies that should be undertaken to avoid or solve a particular problem under consideration.
• B)deal with the aggregate.
• C)deal with what ought to be as opposed to what is.
• D)are forms of positive economics.
• E)deal with individual entities in an economy.

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Definitions:

Utility Function

A utility function is a mathematical representation of a consumer's preference ranking for different bundles of goods, showing the level of satisfaction for each.

Wealth

A substantial amount of monetary assets or physical valuables that are capable of being changed into a format usable for trading purposes.

Utility Function

A mathematical representation of how a consumer ranks different bundles of goods according to their level of satisfaction or utility.

Risk Averse

A description of an investor or decision-maker who prefers to avoid risk, choosing options with potentially lower returns but lesser risks.