Mastering Economic Agents

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Questions and Answers

ECONOMIC AGENTS INCLUDE:

  • GOVERNMENT
  • CONSUMERS
  • PRODUCERS
  • ALL OF THE ABOVE (correct)

CONDITION WHERE WE STUDY THE EQUILIBRIUM IN ONE MARKET ONLY AND LEAVING OTHER MARKETS UNCHANGED

PARTIAL EQUILBRIUM

WHICH OF THESE IS NOT AN EXAMPLE OF A MICRO- MACRO PARADOX?

  • SAVINGS
  • CONSUMPTION
  • PRODUCTION (correct)
  • TAXATION

WHO IS THE FATHER OF MACROECONOMICS

<p>J M KEYNES (A)</p> Signup and view all the answers

WHICH OF THESE IS AN EXAMPLE OF MICROECONOMIC STUDY?

<p>CEMENT INDUSTRY (C)</p> Signup and view all the answers

THE BOOK WRITTEN BY J M KEYNES IS

<p>THE GENERAL THEORY OF EMPLOYMENT, INTERST AND MONEY (C)</p> Signup and view all the answers

WHICH OF THESE IS NOT AN SCOPE (USE) OF MACROECONOMICS

<p>PROFIT MAXIMISATION (B)</p> Signup and view all the answers

In the following questions, a statement of assertion (A) is followed by a statement of Reason (R). Mark the correct choice as given below: ASSERTION: Aggregation is involved only in macroeconomics

   REASON: Output of a firm is not a macro variable

<p>Assertion(A) is false but reason(R) is true. (D)</p> Signup and view all the answers

In the following questions, a statement of assertion (A) is followed by a statement of Reason (R). Mark the correct choice as given below: ASSERTION: central bank of a country regulates the supply of money in the economy

   REASON: total output and employment are taken as constant in macroeconomics

<p>Assertion(A) is true but reason(R) is false. (C)</p> Signup and view all the answers

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Study Notes

Economic Agents

  • Economic agents include individuals, firms, governments, and central banks.

Microeconomics

  • In microeconomics, we study the equilibrium in one market only, leaving other markets unchanged.
  • Example of microeconomic study: Analyzing the behavior of a firm or an individual in a market.

Macroeconomics

  • Father of macroeconomics: John Maynard Keynes.
  • Book written by J.M. Keynes: (No specific book mentioned, but a famous one is "The General Theory of Employment, Interest and Money").
  • Scope of macroeconomics: (All options are correct, but one is not mentioned in the text, so it cannot be determined).

Aggregation and Macroeconomics

  • Aggregation is involved in macroeconomics.
  • Assertion: Aggregation is involved only in macroeconomics.
  • Reason: This is because output of a firm is not a macro variable.

Central Bank and Money Supply

  • The central bank of a country regulates the supply of money in the economy.
  • Assertion: Central bank regulates the supply of money in the economy.
  • Reason: This is not because total output and employment are taken as constant in macroeconomics, but rather because the central bank's role is to manage the money supply.

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