Which of the following exemplifies a microeconomic question?

• A. What causes inflation in the entire economy?
• B. What factors determine a country's overall unemployment rate?
• C. How does government spending influence national economic growth?
• D. How does a rise in the price of coffee affect the quantity demanded by consumers?

Answer: (D)

Verified step by step guidance

1. Step 1: Understand the difference between microeconomics and macroeconomics. Microeconomics focuses on individual agents such as consumers, firms, and markets, while macroeconomics looks at the economy as a whole, including aggregate variables like inflation, unemployment, and national growth.
2. Step 2: Analyze each question to identify whether it deals with individual behavior or aggregate economic outcomes. For example, questions about inflation, unemployment rates, and government spending on national growth are macroeconomic because they concern the overall economy.
3. Step 3: Identify the question that focuses on the behavior of individual consumers or firms. The question about how a rise in the price of coffee affects the quantity demanded by consumers is microeconomic because it examines consumer behavior in a specific market.
4. Step 4: Recognize that microeconomic questions often involve concepts like demand and supply, price elasticity, consumer choice, and market equilibrium at the individual or firm level.
5. Step 5: Conclude that the question 'How does a rise in the price of coffee affect the quantity demanded by consumers?' exemplifies a microeconomic question because it studies the response of consumers to price changes in a particular market.