Which of the Following Does Macroeconomics Endeavor to Answer

question 28

Multiple Choice

Which of the following does macroeconomics endeavor to answer?
i. What role does the government play in recessions, booms, and determining the rate of inflation?
ii. What caused the currency crises in Mexico in the mid-1990s and in many Asian economies at the end of the 1990s?
iii. How does a dairy farmer react to rising milk prices?

• A) iii only
• B) ii only
• C) i and ii
• D) i, ii, and iii
• E) i and iii

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Definitions:

Direct Materials

Raw materials that are directly traceable to the manufacturing of a product and constitute a significant portion of the costs of goods produced.

Prime Costs

The total cost of direct materials and direct labor incurred in the production of goods.

Conversion Costs

The combination of labor costs and overhead costs that are incurred to convert raw materials into finished goods.

Direct Labor Cost

The total cost of wages paid to workers directly involved in the production of goods or services, excluding benefits and overtime.