Economics in Modules 3rd Edition Krugman Solutions Manual

4816-6-1P AID: 1084 | 04/03/2012

RID: 997 | 26/03/2012

(a) A case of microeconomic study: Micro economics deals with the analysis of small units of the economy like individual consumer, individual producer, individual firm and many more. It is a unit analysis. It studies about particulars. So the study of the effect of closer of a large manufacturing plant on an individual Ms. Martin’s tips who is working in a nearby restaurant is question of microeconomics.

(b) A case of macroeconomic study: Macro economics is the study of the economic system as a whole. It is aggregate analysis. It studies about aggregates and averages like national income, total output, total employment and many more. So, the study of the effect of recession in the economy on the aggregate spending of the consumers is a question of macroeconomics.

(c) A study of microeconomics: Since the price of oranges and changes in it due to late frost is an individual aspect, it is a question of microeconomics.

(d) A study of microeconomics: It is a study of particular manufacturing plant where labor unions were formed to affect the wages of that particular firm. So it is a question of microeconomics.

(e) A study of macroeconomics: As the country’s exports have been effected due to a fall in the dollar value in the foreign exchange market, it is a study about general concepts; a study of macroeconomics.

(f) A study of macroeconomics: Both the terms rate of unemployment and inflation is aggregate concepts and the study of their relationship is purely a matter of macroeconomics.