Which of the following issues is related to microeconomics ?
Correct answer: A. the impact of oil prices on car production
- A. the impact of oil prices on car production
- B. The impact of money on inflation
- C. The impact of technology on economics growth
- D. The impact of the deficit on saving
Explanation
Oil prices affect the costs and output decisions of car producers, an industry-level relationship studied in microeconomics. Inflation, economic growth, and budget deficits concern economy-wide variables and are macroeconomic issues.
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About Microeconomics
Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
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