Create a real or hypothetical question that could be addressed with positive analysis regarding a microeconomics...

Create a real or hypothetical question that could be addressed with positive analysis regarding a microeconomics issue that affects your household or your firm.

An example of a microeconomics question that could be addressed with positive analysis is:

“How would an increase in the Federal minimum wage to $12/hour increase impact the cost of childcare in the US?”

I need to create a question of my own please use the example as reference. Thank you please original work only

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Expert Solution

Question on microeconomic issue---Volatility of prices is a microeconomic issue. So the question may be as follows-

Why are markets so volatile this year and how does volatility of prices affect households and firms?

Price fluctuations of a commodity is referred as price volatility.The everyday percentage difference in price is used to measure volatility of prices .The degree of variation of the prices , not the level of prices,determines market volatility.So volatility means price uncertainty in markets.This year the market has been volatile due to the coronavirus pandemic.High volatility means the stock prices moves a lot. Volatility in the market is a natural phenomena which tries to keep stocks in the strong hands of long term investors thus driving out the short term players in the market.Thus volatility is necessary.With high prices both firms and business suffer as cost goes up.But high prices affect firms in a positive way at times because a firm may buy a new customised equipment at high prices for the increase in business profit.So there is a change in the sentiment of the investor.

Rahul Sunny answered 1 year ago

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