Question : Statement 1: Macroeconomics focuses on studying the aggregate level of economic activity, such as GDP and inflation.
Statement 2: Microeconomics analyzes the behavior of individual consumers and producers in the market.
Option 1: Statement 1 is true, and statement 2 is false.
Option 2: Statement 1 is false, and statement 2 is true.
Option 3: Both statements 1 and 2 are true.
Option 4: Both statements 1 and 2 are false.
Correct Answer: Both statements 1 and 2 are true.
Solution : The correct answer is (c) Both statements 1 and 2 are true.
Statement 1 is true: Macroeconomics indeed focuses on studying the aggregate level of economic activity. It examines variables such as Gross Domestic Product (GDP), inflation, unemployment, and overall economic growth. Macroeconomics seeks to understand the behavior of the economy as a whole and the factors influencing its performance.
Statement 2 is also true: Microeconomics analyzes the behavior of individual consumers and producers in the market. It examines how households and firms make decisions regarding consumption, production, pricing, and resource allocation at the individual level. Microeconomics focuses on understanding the forces of supply and demand and how they interact to determine market outcomes.
Therefore, both statements 1 and 2 are true.
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