#1
What does the term 'opportunity cost' refer to in economics?
The cost of a particular choice in terms of the next best alternative foregone
ExplanationCost of choosing one option over another.
#2
What is the primary purpose of using cost-benefit analysis in business decision-making?
To evaluate the potential benefits against the costs of a decision
ExplanationAssessing benefits versus costs for decision-making.
#3
In economics, what does GDP stand for?
Gross Domestic Product
ExplanationTotal value of goods and services produced in a country.
#4
Which of the following is an example of a regressive tax?
Sales tax
ExplanationTax rate decreases as income increases.
#5
What does the term 'elasticity' measure in economics?
The responsiveness of quantity demanded to a change in price
ExplanationDegree of responsiveness of demand to price changes.
#6
Which of the following is a characteristic of perfect competition?
Many sellers with identical products
ExplanationMany sellers offering identical goods.
#7
What is the formula for calculating price elasticity of demand?
Percentage change in quantity demanded / Percentage change in price
ExplanationMeasure of responsiveness of quantity demanded to price changes.
#8
Which of the following best describes the 'Law of Diminishing Marginal Utility'?
As a consumer consumes more units of a good, the additional satisfaction from each additional unit decreases
ExplanationDecrease in satisfaction from consuming additional units.
#9
Which of the following is NOT considered a factor of production in economics?
Profits
ExplanationEarnings from business activities.
#10
What is the term for a situation where the quantity demanded exceeds the quantity supplied at a given price?
Shortage
ExplanationDemand exceeds available supply.
#11
Which economic concept refers to a market situation where there is only one seller of a particular product?
Monopoly
ExplanationSingle seller dominating the market.
#12
What does the 'Laffer curve' represent in economics?
The relationship between tax rates and tax revenue
ExplanationIllustrates effects of tax rates on government revenue.
#13
What is 'inflation targeting' in monetary policy?
A policy aimed at controlling the money supply to keep inflation within a target range
ExplanationPolicy aiming to manage inflation rates.
#14
What is the term used to describe the situation where a firm has control over the market price of its product?
Monopoly
ExplanationSingle firm controlling market price.