#1
Which of the following best describes the concept of opportunity cost?
The value of the next best alternative foregone when a decision is made
ExplanationOpportunity cost is the value of the next best alternative foregone when a decision is made.
#2
In economics, what does GDP stand for?
Gross Domestic Product
ExplanationGDP stands for Gross Domestic Product, representing the total value of goods and services produced in a country.
#3
What is the primary goal of monetary policy?
To control inflation
ExplanationThe primary goal of monetary policy is to control inflation and stabilize the economy's overall price levels.
#4
What does the term 'inflation' refer to in economics?
A sustained increase in the general price level of goods and services in an economy over a period of time.
ExplanationInflation is a sustained increase in the general price level of goods and services over time.
#5
What does the term 'ceteris paribus' mean in economics?
All else being equal
ExplanationCeteris paribus means 'all else being equal' and is used to isolate the impact of a specific variable in economic analysis.
#6
What does the term 'elasticity of demand' refer to?
The measure of how much quantity demanded of a good responds to a change in the price of that good
ExplanationElasticity of demand measures how quantity demanded responds to changes in the price of a good.
#7
What does the term 'marginal utility' represent in economics?
The additional satisfaction gained from consuming one more unit of a good or service
ExplanationMarginal utility is the additional satisfaction gained from consuming one more unit of a good or service.
#8
What is the difference between a monopoly and an oligopoly?
A monopoly has only one firm dominating the market, while an oligopoly has a few firms dominating the market.
ExplanationA monopoly is characterized by a single dominant firm, while an oligopoly involves a few firms dominating the market.
#9
What does the term 'fiscal policy' refer to in economics?
The government's use of taxation and spending policies to influence economic conditions.
ExplanationFiscal policy refers to the government's use of taxation and spending to influence economic conditions.
#10
What does the term 'comparative advantage' refer to in international trade?
The ability of a country to produce a good at a lower opportunity cost than another country.
ExplanationComparative advantage is the ability of a country to produce a good at a lower opportunity cost than another country.
#11
What is the formula for calculating the unemployment rate?
Unemployment Rate = (Number of unemployed / Labor Force) × 100%
ExplanationThe unemployment rate is calculated as (Number of unemployed / Labor Force) × 100%.
#12
Which of the following is an example of a regressive tax?
Sales tax
ExplanationSales tax is an example of a regressive tax, where the tax rate is higher for lower-income individuals.
#13
What is the 'Laffer Curve' in economics?
A curve illustrating the relationship between the tax rate and tax revenue.
ExplanationThe Laffer Curve illustrates the relationship between the tax rate and tax revenue, showing the point of optimal taxation.
#14
What is the formula for calculating consumer surplus?
Consumer Surplus = Marginal Benefit - Price Paid
ExplanationConsumer surplus is calculated as the difference between marginal benefit and the price paid for a good or service.
#15
In economics, what is the 'Phillips Curve' used to illustrate?
The relationship between unemployment and inflation.
ExplanationThe Phillips Curve illustrates the trade-off between unemployment and inflation in the economy.