Answered: What would be another example of a…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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What would be another example of a system in the real world that could serve as a metaphor for micro and macro economics

Transcribed Image Text:units such as the Hms and the owners of the factors of production. Such specific economic units constitute a very small segment of the whole economy. On the other hand. Macroeconomics deals with the economic behavior of the whole economy or its aggregates such as govemment, business and household. An aggregate is composed of individual units. The operation of the various aggregates and their interrelationships are analyzed to provide a profile of the economy as a whole. Self-Check Question Activity 1 1. What would be another example of a "system" in the real world that could serve as a metaphor for micro and macroeconomics? B. Economic Decision Making Decision making is the process of identifying alternative courses of action and selecting an appropriate alternative in a given decision situation. This definition presents two important parts: 1. Identifying alternative courses of action means that an ideal solution may not exist or might not be identifiable. 2. Selecting an appropriate alternative implies that there may be a number of appropriate alternatives and that inappropriate alternatives are to be evaluated and rejected. Thus, judgment is fundamental to decision making. Choice is implicit in our definition of decision making. We may not like the alternatives available to us, but we are seldom left without choices. ecisfons involving money. All economic decisions of any consequence require the use of some ort of accounting intorination, often in the form of financial reports. Economic decision making, in this module, refers to the process of making business Economic decision makers are either internal or external. Internal decision ompany, while external decision makers are individuals or organizations outside Ilustration 1- illustrates lakers are individuats within a company who make decisions on behalf of the

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