The Branch of Economics Which Studies How Households and Firms

question 176

Multiple Choice

The branch of economics which studies how households and firms make choices,interact in markets,and how government attempts to influence their choices is called

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

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Definitions:

Mutually Beneficial

A situation or transaction where all parties involved gain or benefit from the arrangement.

Terms of Trade

The ratio of export prices to import prices. It shows how much import goods a country can buy for each unit of export goods it sells.

Production Possibilities

A curve depicting all maximum output possibilities for two goods, given a set of inputs consisting of resources and other factors.