#1
What does GDP stand for?
Gross Domestic Product
ExplanationMeasure of a country's economic performance.
#2
What is the law of demand?
As price increases, quantity demanded decreases
ExplanationInverse relationship between price and quantity demanded.
#3
What is inflation?
An increase in the general price level of goods and services
ExplanationRise in overall prices.
#4
What is a monopoly?
A market structure with only one seller selling a unique product with no close substitutes
ExplanationSingle seller dominating the market.
#5
Which of the following is a characteristic of a mixed economy?
A combination of private and government ownership of resources
ExplanationCoexistence of private and public sectors in resource ownership.
#6
What is the law of supply?
As price increases, supply increases
ExplanationDirect relationship between price and quantity supplied.
#7
Which of the following is not a characteristic of perfect competition?
Barriers to entry
ExplanationAbsence of barriers for firms to enter the market.
#8
What is the formula for calculating GDP?
Consumption + Investment + Government Spending + Exports - Imports
ExplanationSum of all expenditures in an economy.
#9
Which of the following is a fiscal policy tool used to combat recession?
Increasing government spending
ExplanationBoosting public expenditure.
#10
What is the law of diminishing marginal utility?
As consumption of a good increases, the marginal utility decreases
ExplanationDecline in additional satisfaction.
#11
What does the term 'elasticity of demand' measure?
The responsiveness of quantity demanded to a change in price
ExplanationSensitivity of demand to price changes.
#12
What is fiscal policy?
Policy related to government's taxation and spending decisions
ExplanationGovernment's revenue and expenditure management.
#13
What does the term 'opportunity cost' refer to in economics?
The cost of an item or activity in terms of the next best alternative foregone
ExplanationValue of the next best alternative.
#14
What is the Phillips curve used to illustrate?
The relationship between inflation and unemployment
ExplanationTrade-off between inflation and unemployment.
#15
What is the concept of 'deadweight loss' in economics?
The loss of potential welfare that occurs when equilibrium for a good or service is not achieved
ExplanationEfficiency loss due to market inefficiency.
#16
What is the difference between absolute advantage and comparative advantage?
Absolute advantage refers to the ability of a country to produce a good using fewer resources, while comparative advantage refers to the ability of a country to produce a good at a lower opportunity cost
ExplanationEfficiency in resource use vs. opportunity cost.
#17
What is the difference between a command economy and a market economy?
In a command economy, the government owns and controls the means of production, while in a market economy, individuals and businesses own and control the means of production
ExplanationControl of production by government vs. private entities.
#18
What is the difference between oligopoly and monopolistic competition?
In oligopoly, there are only a few firms selling identical products, while in monopolistic competition, there are many firms selling differentiated products
ExplanationMarket structure and product differentiation.