#1
Which of the following is NOT a determinant of price elasticity of demand?
Availability of substitutes
Income level of consumers
Advertising expenditure
Necessity of the good
#2
What is the main function of fiscal policy?
To control the money supply and interest rates
To regulate international trade
To manage government spending and taxation
To control inflation and unemployment
#3
What is the concept of opportunity cost in economics?
The total cost of producing a good or service
The cost of the next best alternative when making a decision
The monetary value of a good or service
The cost of labor and materials needed for production
#4
What is the concept of the 'invisible hand' in economics?
The role of government in regulating markets
The tendency of markets to self-regulate through the actions of individuals pursuing their self-interest
The influence of advertising on consumer behavior
The impact of technological innovation on economic growth
#5
What is the law of demand?
As the price of a good increases, the quantity demanded decreases
As the price of a good decreases, the quantity demanded decreases
As the price of a good increases, the quantity demanded increases
As the price of a good decreases, the quantity demanded remains constant
#6
What is the formula for calculating total revenue?
Price × Quantity demanded
Price ÷ Quantity demanded
Quantity demanded ÷ Price
Quantity demanded - Price
#7
What does the term 'price floor' refer to in economics?
A legally established minimum price for a good or service
The equilibrium price of a good or service
The highest price a consumer is willing to pay for a good or service
The price level at which the quantity supplied exceeds the quantity demanded
#8
In a perfectly competitive market, how does an increase in demand affect equilibrium price and quantity?
Price increases, quantity remains constant
Price remains constant, quantity increases
Price and quantity both increase
Price and quantity both decrease
#9
What is the law of diminishing marginal returns?
As more units of a variable input are added to a fixed input, the marginal product of the variable input eventually decreases
The total output of a production process always increases as more units of input are added
The average product of a variable input increases indefinitely as more units of input are added
There are no diminishing returns in production
#10
Which of the following is NOT a characteristic of monopolistic competition?
Many buyers and sellers
Product differentiation
Price taker
Low barriers to entry
#11
Which of the following is NOT a characteristic of a perfectly competitive market?
Many buyers and sellers
Homogeneous products
Barriers to entry
Perfect information
#12
What is the formula for calculating price elasticity of demand?
Percentage change in quantity demanded / Percentage change in price
Percentage change in price / Percentage change in quantity demanded
Total revenue / Quantity demanded
Quantity demanded / Total revenue
#13
What is the main function of a central bank in an economy?
To regulate government spending
To control inflation and manage monetary policy
To oversee the stock market
To enforce antitrust laws
#14
What is the 'Phillips Curve' in macroeconomics?
A graphical representation showing the relationship between inflation and unemployment
A theory that explains how changes in the money supply affect interest rates and investment
A model used to predict the impact of government fiscal policy on aggregate demand
A principle stating that the total demand for goods and services in an economy will equal the total supply
#15
Which of the following is an example of an expansionary monetary policy?
Increasing reserve requirements for banks
Selling government securities on the open market
Decreasing the discount rate
Raising taxes
#16
What is the difference between nominal GDP and real GDP?
Nominal GDP is adjusted for inflation, while real GDP is not
Real GDP is adjusted for inflation, while nominal GDP is not
Nominal GDP includes only domestically produced goods and services, while real GDP includes imports and exports
There is no difference between nominal GDP and real GDP
#17
In the context of international trade, what is protectionism?
The policy of reducing barriers to trade
The policy of encouraging free trade agreements
The policy of imposing tariffs and quotas to protect domestic industries
The policy of promoting outsourcing
#18
What is the difference between microeconomics and macroeconomics?
Microeconomics focuses on individual markets, while macroeconomics focuses on the economy as a whole
Macroeconomics focuses on individual markets, while microeconomics focuses on the economy as a whole
There is no difference between microeconomics and macroeconomics
Microeconomics studies the behavior of individual consumers, while macroeconomics studies the behavior of firms