Question

Macroeconomic conditions affect the decisions firms and families make. After graduation, a college student might enter the job market during an economic expansion but apply for graduate school during a recession because:

A) Job opportunities are more abundant during expansions
B) Graduate school provides additional skills for a competitive job market
C) Job opportunities are scarce during recessions
D) Both A and B

Answer 1

A college student might enter the job market during an economic expansion and apply for graduate school during a recession due to job opportunities and additional skills.

Step-by-step explanation:

In economics, the micro decisions of individual businesses are influenced by whether the macroeconomy is healthy. For example, firms will be more likely to hire workers if the overall economy is growing. In turn, microeconomy's performance ultimately depends on the microeconomic decisions that individual households and businesses make.So, in the context of the question, a college student might enter the job market during an economic expansion because job opportunities are more abundant during expansions (option A). This is because when the overall economy is growing, firms are more likely to expand and hire new employees. On the other hand, a college student might apply for graduate school during a recession because job opportunities are scarce, making it a more competitive job market. Going to graduate school can provide additional skills and qualifications to make the student more competitive in the job market (option B). Therefore, the answer to the question is option D) Both A and B.