Introduction to Macroeconomics

Which best describes what occurs in the product market?

the exchange of goods and services for money

Which best describes the purpose served by economic models within an economic system?

Models identify patterns.

What area of economics focuses on the interactions between individual consumers and producers?

microeconomics

In macroeconomics, the economy can best be understood through the use of

models.

This is a graph showing price and total output in the short and long run. According to this graph, how does supply behave in the long run?

Output remains constant.

In microeconomics, what occurs when equilibrium is reached?

Prices are set.

The aim of the study of macroeconomics is to examine

the behavior of factors affecting the economy.

This is a graph showing price and total output in the short and long run. According to this graph, how does supply behave in the short run and long run?

Output reacts differently.

The circular flow model examines interactions between which two groups?

households and firms