Economic Concepts and Goods Quiz

Money is not considered a factor of production as it is not directly involved in the production process.

GDP stands for Gross Domestic Product, which measures the total value of all goods and services produced within a country's borders.

Inflation refers to the increase in the general price level of goods and services over a period of time.

Opportunity cost in economics refers to the value of the next best alternative foregone when a decision is made.

Ceteris paribus in economics means all else being equal, indicating the assumption that all relevant variables other than those under consideration are held constant.

Generic brand cereal is considered an inferior good because its demand decreases when consumer incomes rise.

Gross Domestic Product (GDP) measures the total value of all final goods and services produced within a country's borders in a given period of time.

Gross National Product (GNP) measures the total value of all goods and services produced by a country's residents regardless of where they are located.

A monopoly is a market situation where there is only one seller for a particular product or service.

A fiscal deficit occurs in economics when the government spends more money than it collects in revenue.

The law of diminishing marginal utility states that as a consumer consumes more of a good, the additional satisfaction from each additional unit of the good decreases.

A perfectly competitive market is characterized by having many buyers and sellers, each having negligible market power.

Excludability is not a characteristic of a public good, as public goods are non-excludable, meaning individuals cannot be effectively excluded from using them.

A sales tax is an example of a regressive tax, as it takes a larger percentage of income from low-income earners compared to high-income earners.

A beekeeper's honey production benefiting nearby orchards is an example of a positive externality, where a third party benefits from the production or consumption of a good without compensation.