Macroeconomics focuses on:

-the decisions and behaviors of sellers in specific markets.

-the decisions and behaviors of buyers in specific markets.

-economic aggregates, such as unemployment, inflation, and economic growth.

-how government policy should be used to decide what and how to produce.

QUESTION 2

When there is scarcity, wants and needs exceed the resources available to satisfy them. Therefore:

-decisions must be made about how to allocate limited resources among competing uses.

-government must identify areas of greatest need and direct resources to those areas.

-the economy is not able to operate at a point on the production possibilities frontier.

-all societies in the world must rely on free market forces to determine what and how to produce.

Question 1:

The answer is economic aggregates, such as unemployment, inflation and economic growth This is what macroeconomists study since they are concerned with the bigger picture events of an economy. The first two possible answers are connected to microeconomics since they focus on the study of specific market changes. The last answer is sometimes used by macroeconomists, however its not a universal. Some macroeconomists believe that strong government policies will help an economy grow, but others do not, so it is not the best description of what macroeconomists study.

Question 2:

decisions must be made about how to allocate limited resources among competing uses.

Because of the economic condition of scarcity, there are many uses for resources, so firms, consumers, and governments must all make production and allocation decisions. The second answer refers to a command style economy and is not true of all economies. It is the opposite of that last answer, where supply and demand market forces make up all the production and allocation choices. This is not true either since most countries have some government decision making when it comes to scarce resources. The answer about the production possibilities frontier isn't true since scarcity represents the limit of where society can produce, and an efficient economy will make choices on where to produce, that will fall on a production possibilities frontier.