#1
In economics, what is the law of demand?
As the price of a good decreases, the quantity demanded increases.
ExplanationInverse relationship between price and quantity demanded.
#2
What does 'Ceteris Paribus' mean in economics?
All else being equal
ExplanationIsolating one variable while keeping others constant for analysis.
#3
Which of the following is NOT a characteristic of perfect competition?
Limited information
ExplanationPerfect competition assumes perfect information.
#4
What is the 'Marginal Revenue' in economics?
The revenue from selling one more unit
ExplanationAdditional revenue generated by selling an extra unit.
#5
What is a 'Monopoly' in economics?
A market structure with only one seller and many buyers
ExplanationSingle seller dominating the market.
#6
Which of the following is NOT a barrier to entry in a monopoly market?
Product differentiation
ExplanationProduct variety is not a barrier in a monopoly.
#7
What is 'Price Discrimination' in economics?
Charging different prices to different customers for the same product
ExplanationVarying prices based on customer characteristics.
#8
What is 'Price Elasticity of Demand'?
The measure of how much the quantity demanded of a good responds to a change in the price of that good
ExplanationSensitivity of quantity demanded to price changes.
#9
What is 'Perfect Competition'?
A market structure with many buyers and sellers, identical products, and perfect information
ExplanationIdeal market with numerous buyers and sellers.
#10
What is 'Economic Efficiency'?
The condition in which all resources are allocated optimally to maximize total surplus
ExplanationOptimal allocation of resources for maximum surplus.
#11
Which of the following is NOT a characteristic of a monopoly market?
Price taker
ExplanationMonopoly sets its own prices, not influenced by market.
#12
What is 'Opportunity Cost'?
The value of the next best alternative foregone when a choice is made
ExplanationCost of the best alternative given up.
#13
What is 'Market Equilibrium'?
A situation where the quantity demanded equals the quantity supplied
ExplanationBalance between demand and supply in the market.
#14
Which of the following is NOT a characteristic of monopolistic competition?
Identical products
ExplanationProducts in this market have differentiation.
#15
What is 'Diminishing Marginal Utility'?
The decrease in the total utility gained from consuming additional units of a good
ExplanationReduced satisfaction from consuming more units.
#16
Which of the following statements best describes the concept of 'Elasticity of Supply'?
It measures the responsiveness of quantity supplied to a change in price.
ExplanationHow quantity supplied changes with a change in price.
#17
What does 'Profit Maximization' mean for a firm in economics?
Maximizing the difference between total revenue and total cost
ExplanationSeeking the highest profit by optimizing revenue and cost.
#18
What is 'Oligopoly' in economics?
A market structure with only a few sellers, each offering a similar or identical product
ExplanationA market dominated by a small number of sellers.
#19
What is 'Deadweight Loss'?
The loss in economic surplus resulting from the misallocation of resources
ExplanationLoss due to inefficient allocation of resources.
#20
Which of the following is a characteristic of a monopolistically competitive market?
Product differentiation
ExplanationDifferentiated products in a competitive market.
#21
What is 'Game Theory'?
The study of how people make decisions in strategic situations
ExplanationAnalyzing decision-making in strategic interactions.
#22
Which of the following is a characteristic of monopolistic competition?
Product differentiation
ExplanationVaried products with differentiation in a competitive market.
#23
What is 'Externality'?
The benefit or cost that affects someone who is not directly involved in the production or consumption of a good or service
ExplanationIndirect impact on those not directly involved.
#24
What is 'Monopsony'?
A market structure with one buyer and many sellers
ExplanationSingle buyer with multiple sellers in the market.
#25
What is 'Perfect Price Discrimination'?
Selling products at different prices to different customers based on willingness to pay
ExplanationCustomized pricing based on individual willingness to pay.