Which of the following statement/statements are true?
Statement 1: Macroeconomics has deep roots in Microeconomics.
Statement 2: Micro economics studies the aggregate effects of the forces of demand and supply in the markets.
Answer & explanation
Correct answer: option 3
The correct answer is Option 3: Statement 1 is true and Statement 2 is false
Statement 1: Macroeconomics has deep roots in Microeconomics. This is correct. Macroeconomics has deep roots in microeconomics because it has to study the aggregate effects of the forces of demand and supply in the markets.
Statement 2: Micro economics studies the aggregate effects of the forces of demand and supply in the markets. This is false. The study of aggregate or economy-wide effects of demand and supply belongs to macroeconomics, not microeconomics. Microeconomics studies individual units such as a consumer, producer or a particular market.