Which of the following BEST describes macroeconomics?
A) It analyzes the aggregate effects on the national economy of the choices made by individuals, firms, and governments.
B) It studies the choices that individuals and businesses make when coping with scarcity.
C) It examines how the choices that individuals affect governments.
D) It is not a social science because its predictions cannot be tested.
E) Proving causation is never a problem for macroeconomics.

Question

Quizplus · Accepted Answer

Macroeconomics focuses on the overall performance and behavior of the economy as a whole, and how it is influenced by factors such as government policies, international trade, and the actions of firms and individuals. It does not primarily focus on the choices made by individuals and firms in coping with scarcity (which is part of microeconomics) or examine how individual choices affect governments (which is more a matter of political science). Macroeconomics is a social science, and while proving causation can be challenging in this field (as in any social science), it does attempt to make and test predictions about the behavior of the economy.

Which of the Following BEST Describes Macroeconomics