7) Which is the most accurate definition of the study of economics? Economics is the study of A) the distribution of surplus goods to those in need. B) affluence in a morally bankrupt world. C) ways to reduce wants to eliminate the problem of scarcity. D) the choices we make because of scarcity. 7) 8) Which of the following is a macroeconomic topic? A) why plumbers earn more than janitors B) the reasons for the rise in average prices C) whether the army should buy more tanks or more rockets D) the reasons for a rise in the price of orange juice 8) 9) Which of the following is a microeconomic topic? A) the reasons for a decline in average prices B) the reasons why Kathy buys less orange juice C) the cause of why total employment may decrease D) the effect of the government budget deficit on inflation 9) 1 10) Microeconomics focuses on all of the following EXCEPT A) the effect of increasing the money supply on inflation. B) the purchasing decisions that an individual consumer makes. C) the effect of an increase in the tax on cigarettes on cigarette sales. D) the hiring decisions that a business makes. 10) 11) In broad terms the difference between microeconomics and macroeconomics is that A) microeconomics studies the effects of government taxes on the national unemployment rate. B) macroeconomics studies the effects of government regulation and taxes on the price of individual goods and services whereas microeconomics does not. C) they use different sets of tools and ideas. D) microeconomics studies decisions of individual people and firms and macroeconomics studies the entire national economy.