For microeconomics, macro phenomena like inflation or unemployment were either not mentioned or were taken as given. Why?
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Individual buyers or sellers had no power to change them
Microeconomics studies individual buyers and sellers. Inflation and unemployment were not variables they could change, so micro took them as given.
Option (1) They were the concern of statutory bodies like the RBI and SEBI — Incorrect. The RBI and SEBI pursue macro policies, but that is not the reason.
Option (2) Individual buyers or sellers had no power to change them — Correct. No single buyer or seller can change the price level or unemployment.
Option (3) They were already explained by General Equilibrium — Incorrect. General Equilibrium is the equilibrium of supply and demand in each market; it did not explain inflation or unemployment.
Option (4) They did not occur in economies before the Great Depression — Incorrect. The reason lies in who can change these variables, not in when they occurred.
NCERT (2026-27): “Introduction … For microeconomics the ‘macro’ (meaning ‘large’) phenomena affecting the economy as a whole, like inflation or unemployment, were either not mentioned or were taken as given. These were not variables that individual buyers or sellers could change. The nearest that microeconomics got to macroeconomics was when it looked at General Equilibrium, meaning the equilibrium of supply and demand in each market in the economy. …” “… Macroeconomic policies are pursued by the State itself or statutory bodies like the Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI) and similar institutions. …” |