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Question
Which of the following is defined as branch of economic analysis that studies the economic behaviour of the individual unit, a particular household, or a particular firm?
Which of the following is defined as branch of economic analysis that studies the economic behaviour of the individual unit, a particular household, or a particular firm?
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Solution
The correct option is C Micro economics
Microeconomics is defined as "The study of the economic choices individuals and firms make and of how these choices create markets."
The study of microeconomics looks at specific markets individually and in great detail. Thus it will tend to examine micro variables such as the demand and supply decisions specific to a particular market or good. Thus its variables of concern will include how individual firms, individual workers, individual consumers, and individual investors interact and make decisions in the marketplace.
It will not be concerned with the aggregate market demand, or any other aggregate variables that treat the whole economy as one unit.
Microeconomics is defined as "The study of the economic choices individuals and firms make and of how these choices create markets."
The study of microeconomics looks at specific markets individually and in great detail. Thus it will tend to examine micro variables such as the demand and supply decisions specific to a particular market or good. Thus its variables of concern will include how individual firms, individual workers, individual consumers, and individual investors interact and make decisions in the marketplace.
It will not be concerned with the aggregate market demand, or any other aggregate variables that treat the whole economy as one unit.
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