Economic Concepts and Terminology Quiz

Inflation is the rise in the overall price level of goods and services in an economy.

GDP stands for Gross Domestic Product, representing the total value of goods and services produced within a country.

The total value of all final goods and services produced in a country within a specific period is referred to as Gross Domestic Product (GDP).

Consumer Price Index (CPI) is a measure of the average level of prices for goods and services in an economy.

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

The total value of goods and services produced in a country within a specific time period is known as Gross Domestic Product (GDP).

Laissez-faire Economics is the economic theory advocating minimal government intervention in economic activities and markets.

Perfect Competition is a market structure with numerous sellers and buyers of identical or similar products, fostering healthy competition.

Taxation is not a tool of monetary policy; monetary policy typically involves actions related to money supply and interest rates.

A progressive tax is a tax system where the tax rate increases as the taxable amount increases.

Profit is not considered a factor of production; factors typically include land, labor, and capital.

Surplus is the situation where the quantity supplied of a good or service exceeds the quantity demanded in the market.

Price elasticity of demand measures how the quantity demanded of a good responds to changes in its price.

Comparative advantage refers to a country's ability to produce a good at a lower opportunity cost compared to another country.

Moral hazard in economics refers to the risk that individuals or companies may take greater risks because they are protected or insured against potential losses.