#1
What is the law of demand?
As the price decreases, quantity demanded increases
ExplanationInverse relationship between price and quantity demanded.
#2
What does GDP stand for in economics?
Gross Domestic Product
ExplanationTotal value of all goods and services produced within a country's borders.
#3
What is the difference between microeconomics and macroeconomics?
Microeconomics studies individual markets, while macroeconomics studies the economy as a whole
ExplanationFocus on individual markets vs. the entire economy.
#4
What is a monopoly?
A market with only one seller and many buyers
ExplanationSingle seller dominating a market with no close substitutes.
#5
What is the opportunity cost?
The value of the next best alternative
ExplanationCost of forgoing the next best alternative when making a decision.
#6
What is the law of diminishing returns?
As more units of a variable input are added to fixed inputs, the marginal product of the variable input eventually declines
ExplanationOutput gains decrease after a point when adding more of a variable input.
#7
What is price elasticity of demand?
The percentage change in quantity demanded divided by the percentage change in price
ExplanationMeasure of responsiveness of quantity demanded to price changes.
#8
What is fiscal policy?
The use of government spending and taxation to influence the economy
ExplanationGovernment's use of spending and taxes to manage economic conditions.
#9
What is comparative advantage in international trade?
A country can produce a good with lower opportunity cost than another country
ExplanationBasis for mutually beneficial trade between countries.