Microeconomics is the study of a. how money affects the economy. b. how individual households and firms make decisions. c. how government affects the economy. d. how the economy as a whole works.

Question

Layne Potts

Social Studies

3 December, 10:59

Microeconomics is the study of a. how money affects the economy. b. how individual households and firms make decisions. c. how government affects the economy. d. how the economy as a whole works.

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Monica Shepherd · Answer 1

how individual households and firms make decisions.

Explanation:

The field of economics that focuses on how individuals and firms make decisions is called microeconomics.

While microeconomics studies mostly supply and demand, it also explains how forces in the market set price level.

The scope of microeconomics is an internal market, where a bottom-up approach identifies the business factors present like costumers, employees, competitors, actions shareholders and the supply.

It can simply be said that internal markets are the field of study of microeconomics, and when going for a bigger scale, taking further actors government and countries as a whole then we go to the next level: macroeconomics.