Basic Principles of Economics Quiz

Test your understanding with 11 questions covering fundamental concepts in microeconomics, from GDP to market structures.

Practice Learn Test

What is the basic economic problem?

Scarcity

Inflation

Unemployment

Market equilibrium

Which of the following is not considered a factor of production?

Land

Labor

Technology

Capital

What does the term 'ceteris paribus' mean in economics?

All other things being equal

Supply and demand

Demand curve

Elasticity

Which of the following is a macroeconomic variable?

Individual consumer's income

Price of a specific product

Total employment in an economy

Demand for a particular good

What is the law of demand?

As price increases, quantity demanded decreases

As price decreases, quantity demanded increases

As price increases, quantity demanded increases

As price decreases, quantity demanded decreases

What does GDP stand for?

Gross Domestic Price

Government Development Plan

Gross Domestic Product

General Demand Profile

Who is considered the father of modern economics?

Adam Smith

John Maynard Keynes

Karl Marx

Milton Friedman

What is opportunity cost?

The cost of purchasing opportunities

The cost of choosing one alternative over another

The cost of resources used in production

The cost of producing one additional unit of a good

Which of the following is a characteristic of a perfectly competitive market?

High barriers to entry

A large number of firms selling identical products

Significant control over price by individual firms

Presence of differentiated products

#10

What is the role of the Federal Reserve in the United States?

Regulate international trade

Set fiscal policy

Manage monetary policy

Control government spending

#11

What is the formula to calculate Price Elasticity of Demand (PED)?

Percentage change in quantity demanded / Percentage change in price

Percentage change in price / Percentage change in quantity demanded

Total revenue / Quantity demanded

Total revenue / Price