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Which of the following is an example of macroeconomics as opposed to microeconomics?the...

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maheen100 | Student, Undergraduate | Honors

Posted September 16, 2012 at 6:52 PM via web

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Which of the following is an example of macroeconomics as opposed to microeconomics?

the effect of a cigarette tax on the quantity of cigarettes sold

a consumers optimal choice of a flat screen tv

the government optimal spending level

 

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pohnpei397 | College Teacher | (Level 3) Distinguished Educator

Posted September 16, 2012 at 6:58 PM (Answer #1)

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Of the examples given here, only the last has mainly to do with macroeconomics.

Macroeconomics is the study of economic issues that affect an entire economy.  By contrast, microeconomics is interested in a much narrower field.  It looks at issues having to do with the economic decisions of a single person or business or industry.  

In the examples you give, the first has to do with a single industry, the cigarette industry.  The second has to do with one product, the TV.  Only the third one has to do with the economy as a whole.  It asks what level of government spending will yield the best results for the entire economy.  This makes it an example of macroeconomics.

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