#1
What is the primary goal of Economic Welfare Analysis?
Maximizing government revenue
Minimizing inflation
Maximizing the well-being of society
Minimizing unemployment
#2
In the context of Economic Welfare Analysis, what does 'consumer surplus' represent?
The total value of goods produced
The difference between what consumers are willing to pay and what they actually pay
The government's revenue from taxes
The total spending by consumers
#3
Which economic theory suggests that individuals make decisions by comparing the marginal benefits and marginal costs of their actions?
Keynesian economics
Classical economics
Behavioral economics
Marginalism
#4
Which economic concept is related to the idea that individuals have unlimited wants but face scarce resources?
Opportunity cost
Diminishing marginal utility
Perfect competition
Monetary policy
#5
What role does the concept of 'opportunity cost' play in Economic Welfare Analysis?
It represents the cost of goods and services in the market
It quantifies the value of the next best alternative foregone when a decision is made
It measures the level of consumer satisfaction
It evaluates the impact of taxation on consumer surplus
#6
Which of the following is a measure of economic welfare that includes non-market activities?
Gross Domestic Product (GDP)
Net National Product (NNP)
Human Development Index (HDI)
Genuine Progress Indicator (GPI)
#7
In Economic Welfare Analysis, what does the term 'Pareto Efficiency' signify?
Maximizing government intervention
No one can be made better off without making someone worse off
Minimizing externalities
Achieving full employment
#8
Which of the following is a limitation of using Gross Domestic Product (GDP) as a sole indicator of economic welfare?
GDP does not account for income distribution
GDP includes all economic activities
GDP accurately reflects happiness
GDP considers only market transactions
#9
Which economic concept emphasizes the importance of people's preferences and subjective well-being?
Rational expectations
Utility
Price elasticity
Supply and demand
#10
What is the primary objective of cost-benefit analysis in Economic Welfare Analysis?
Maximizing costs and benefits
Minimizing costs and maximizing benefits
Balancing costs and benefits
Ignoring costs and focusing only on benefits
#11
In the context of externalities, what does a positive externality imply?
The cost of an activity is borne by society as a whole
The benefits of an activity spill over to third parties
The government intervenes to correct market failures
Consumers pay more than the market price
#12
Which economic theory emphasizes the importance of individuals' expectations and their impact on economic decisions?
Keynesian economics
Monetarism
Rational expectations theory
Classical economics
#13
Which economic concept is concerned with the distribution of economic welfare among different individuals in society?
Aggregate demand
Utility
Equity
Monopoly
#14
What is the Kaldor-Hicks criterion used for in Economic Welfare Analysis?
Measuring income inequality
Evaluating changes in economic efficiency
Assessing monetary policy
Estimating inflation rates
#15
What is the key difference between normative and positive statements in economics?
Normative statements are based on empirical evidence, while positive statements involve value judgments
Positive statements are concerned with what ought to be, while normative statements are based on facts
Normative statements are objective, while positive statements are subjective
Positive statements are objective, while normative statements involve value judgments
#16
What is the significance of the Gini coefficient in measuring income inequality?
It measures the overall size of the economy
It assesses the efficiency of resource allocation
It quantifies the degree of income inequality within a population
It evaluates the stability of financial markets
#17
In the context of market failures, what is a public good?
A good that is only available to the wealthy
A good that is rivalrous and excludable
A good that is non-rivalrous and non-excludable
A good that is provided by private companies
#18
What is the primary focus of the Harberger Triangle in Economic Welfare Analysis?
Measuring the deadweight loss from taxation
Assessing the impact of monetary policy
Analyzing changes in consumer surplus
Evaluating income distribution
#19
In Economic Welfare Analysis, what does the term 'marginal rate of substitution' (MRS) represent?
The rate at which goods can be substituted for services
The rate at which a consumer can exchange one good for another while maintaining the same level of satisfaction
The rate at which the government intervenes in the market
The rate at which prices change in a competitive market