Microeconomics Fundamentals Quiz

Questions and Answers

What does microeconomics analyze?

Microeconomics analyzes individual agents and markets, their interactions, and the outcomes of interactions in the economy.

What is economics?

Economics is a social science that studies the production, distribution, and consumption of goods and services.

What are some of the broad distinctions within economics?

Broad distinctions within economics include positive economics vs. normative economics, economic theory vs. applied economics, rational economics vs. behavioral economics, and mainstream economics vs. heterodox economics.

What does macroeconomics analyze?

Macroeconomics analyzes the economy as a system where production, consumption, saving, and investment interact, and factors affecting it such as employment, currency inflation, economic growth, and public policies. Signup and view all the answers

Where can economic analysis be applied throughout society?

Economic analysis can be applied throughout society, including business, finance, cybersecurity, health care, engineering, government, and diverse subjects like crime, education, family, feminism, law, philosophy, politics, religion, social institutions, war, science, and the environment. Signup and view all the answers

What is commerce?

Commerce is the large-scale organized system of activities, functions, procedures and institutions that directly or indirectly contribute to the smooth, unhindered distribution and transfer of goods and services on a substantial scale and at the right time, place, quantity, quality and price through various channels from the original producers to the final consumers within local, regional, national or international economies. Signup and view all the answers

What are the principal factors that give rise to commercial exchanges?

The diversity in the distribution of natural resources, differences of human needs and wants, and division of labour along with comparative advantage are the principal factors that give rise to commercial exchanges. Signup and view all the answers

What does trade involve?

Trade involves the exchange of goods (including raw materials, intermediate and finished goods) and services between buyers and sellers in return for a price at traditional (or online) marketplaces. It is categorized into domestic trade, including retail and wholesale as well as local, regional and inter-regional transactions and foreign trade, encompassing import, export and entrepôt/re-export trades. Signup and view all the answers

What are aids to trade or auxiliary commercial activities?

Aids to trade or auxiliary commercial activities facilitate trade and include commercial intermediaries, banking and financial services, transportation, packaging, warehousing, communication, advertising and insurance. Signup and view all the answers

What are the two main categories of trade?

The two main categories of trade are domestic trade (including retail and wholesale as well as local, regional and inter-regional transactions) and foreign trade (encompassing import, export and entrepôt/re-export trades). Signup and view all the answers

Study Notes

Economics

Economics is the study of how societies allocate scarce resources to satisfy unlimited wants and needs.
It analyzes the behavior of individuals, businesses, governments, and other organizations to understand how they make decisions about how to allocate resources.

Microeconomics vs Macroeconomics

Microeconomics analyzes the behavior and decision-making of individual economic units, such as households, firms, and markets.
Macroeconomics analyzes the economy as a whole, looking at aggregate variables such as economic growth, inflation, and unemployment.

Applications of Economic Analysis

Economic analysis can be applied throughout society, including in business, government, healthcare, education, and environmental policy.
It helps us understand how to allocate resources efficiently, make informed decisions, and evaluate the impact of policies.

Commerce and Trade

Commerce refers to the exchange of goods, services, or something of value between businesses or organizations.
The principal factors that give rise to commercial exchanges are the desire for goods and services, the availability of resources, and the existence of markets.
Trade involves the exchange of goods and services between different regions or countries.
Aids to trade, or auxiliary commercial activities, include transportation, banking, insurance, and advertising.

Types of Trade

There are two main categories of trade: internal trade and external trade.
Internal trade refers to the exchange of goods and services within a country or region.
External trade, also known as international trade, refers to the exchange of goods and services between different countries.