Question

Identify each of the following statements as a macroeconomic or microeconomic issue, explaining why each is so. (a) General Motors moved three manufacturing plants to South America. (b) The inflation rate in 2004 for the United States was 3 percent. (c) The total production in the cranberry industry increased four percent last year. (Economics):

a. Microeconomic issue
b. Macroeconomic issue
c. Microeconomic issue

Answer 1

General Motors moving manufacturing plants is a macroeconomic issue, inflation rate is a macroeconomic issue, and cranberry industry production increasing is a microeconomic issue.

Step-by-step explanation:

(a) General Motors moving three manufacturing plants to South America is a macroeconomic issue. This is because it involves the relocation of a large corporation's production facilities, which has implications for the overall economy, including employment, trade, and investment.

(b) The inflation rate in 2004 for the United States being 3 percent is a macroeconomic issue. Inflation affects the purchasing power of consumers, the profitability of businesses, and the overall stability of the economy.

(c) The total production in the cranberry industry increasing four percent last year is a microeconomic issue. It pertains to the specific industry and its performance, rather than the broader economy.