#1
What is the law of demand?
As price increases, quantity demanded increases
As price decreases, quantity demanded decreases
As price increases, quantity demanded decreases
As price decreases, quantity demanded increases
#2
In economics, what does elasticity measure?
The responsiveness of quantity demanded to a change in price
The absolute value of the price
The total revenue generated by a product
The quantity supplied in the market
#3
What is the Phillips Curve in economics?
A curve representing the relationship between inflation and unemployment
A curve showing the relationship between price and quantity demanded
A curve depicting the trade-off between production and consumption
A curve describing the impact of interest rates on investment
#4
What is the difference between fiscal policy and monetary policy?
Fiscal policy involves the control of the money supply, while monetary policy involves government spending and taxation
Fiscal policy involves government spending and taxation, while monetary policy involves the control of the money supply
Both fiscal and monetary policies are synonymous and interchangeable
Fiscal policy and monetary policy are unrelated concepts in economics
#5
What is the concept of inflation in economics?
A situation where prices decrease over time
A sustained increase in the general price level of goods and services in an economy
A scenario where there is a shortage of money in circulation
A measure of the total value of goods and services produced in an economy
#6
What is the production function in economics?
A mathematical equation representing the relationship between inputs and outputs in production
A law stating that production always increases with more inputs
A theory suggesting that production is independent of input factors
A concept describing the efficiency of production
#7
What is the difference between explicit and implicit costs in production?
Explicit costs are direct money payments, while implicit costs are opportunity costs
Explicit costs are opportunity costs, while implicit costs are direct money payments
Both explicit and implicit costs are direct money payments
Both explicit and implicit costs are opportunity costs
#8
What is the opportunity cost of a decision?
The total monetary cost incurred
The highest-valued alternative forgone
The fixed cost associated with the decision
The variable cost associated with the decision
#9
What is the difference between monopolistic competition and perfect competition?
Monopolistic competition has many sellers, while perfect competition has a single seller
Perfect competition has many sellers, while monopolistic competition has a single seller
Monopolistic competition involves differentiated products, while perfect competition involves identical products
Perfect competition involves differentiated products, while monopolistic competition involves identical products
#10
What is the concept of externalities in production?
Positive or negative side effects of production that affect third parties
The internal costs associated with production
The government regulations on production
The fixed costs of production
#11
What is the difference between absolute advantage and comparative advantage?
Absolute advantage refers to the ability to produce more with the same resources, while comparative advantage refers to the ability to produce at a lower opportunity cost
Absolute advantage refers to the ability to produce at a lower opportunity cost, while comparative advantage refers to the ability to produce more with the same resources
Both terms are synonymous and can be used interchangeably
Absolute advantage is a concept applicable only in the short run, while comparative advantage is relevant in the long run
#12
What does the law of diminishing marginal returns state?
As production increases, marginal returns increase
As production increases, marginal returns decrease
As production decreases, marginal returns increase
As production decreases, marginal returns decrease
#13
What is the Cobb-Douglas production function used for?
To model the relationship between inputs and outputs in production
To calculate the total cost of production
To determine the optimal level of production
To assess market demand elasticity
#14
What is the concept of utility in economics?
The total value of goods and services produced in an economy
The satisfaction or pleasure derived from consuming a good or service
The cost incurred in producing a unit of a good or service
The measure of inflation in an economy
#15
What role does the government play in a market economy?
To control and own all means of production
To regulate and ensure fair competition
To determine prices and allocate resources
To eliminate private ownership of property
#16
What is the concept of a production possibility frontier (PPF) in economics?
A curve showing the relationship between input and output
A curve representing the maximum combination of goods and services an economy can produce given its resources
A curve depicting the inverse relationship between price and quantity demanded
A curve indicating the impact of inflation on production
#17
What is the Tragedy of the Commons?
A situation where a shared resource is overused and depleted due to individual self-interest
A scenario where common resources are protected by government regulations
A theory proposing that common resources are infinite and can never be depleted
A concept describing the efficient use of shared resources by the community