Economics concept Quiz

Test your understanding of inflation, GDP, fiscal policy, international trade, elasticity of demand, monopolies, GDP types, opportunity cost, and more in this macroeconomics quiz.

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What is inflation?

A decrease in the general price level of goods and services

An increase in the general price level of goods and services

A stable price level of goods and services

A decrease in the quantity of money in circulation

1 answered

What is Gross Domestic Product (GDP)?

Total value of all goods and services produced within a country in a specific period

Total value of exports minus imports

Total value of all government spending

Total value of all consumer spending

1 answered

What is a budget deficit?

When government spending exceeds government revenue in a given period

When government revenue exceeds government spending in a given period

When total public debt exceeds total government assets

When the government prints more money to finance its spending

1 answered

What is a monopoly?

A market structure with many buyers and sellers

A market structure with one seller and many buyers

A market structure with one buyer and many sellers

A market structure with few sellers offering differentiated products

1 answered

What is the concept of opportunity cost?

The total cost of producing a good or service

The cost of the next best alternative foregone when a decision is made

The cost of resources used in production

The cost of inputs used in production

1 answered

What is a recession?

A period of declining economic activity characterized by falling GDP and rising unemployment

A period of rapid economic growth and increasing prosperity

A period of stable economic growth with low inflation

A period of high inflation and low unemployment

1 answered

What is fiscal deficit?

The total revenue of the government

The total expenditure of the government

The excess of government expenditure over government revenue

The excess of government revenue over government expenditure

1 answered

What is the law of demand in economics?

As price increases, demand increases

As price increases, demand decreases

As price decreases, demand increases

As price decreases, demand decreases

1 answered

What is the difference between fiscal policy and monetary policy?

Fiscal policy deals with government spending and taxation, while monetary policy deals with money supply and interest rates

Fiscal policy deals with money supply and interest rates, while monetary policy deals with government spending and taxation

Fiscal policy is implemented by central banks, while monetary policy is implemented by governments

Monetary policy is aimed at stabilizing prices, while fiscal policy is aimed at controlling inflation

#10

What is the Phillips Curve?

A curve representing the relationship between inflation and unemployment

A curve representing the relationship between GDP and inflation

A curve representing the relationship between interest rates and investment

A curve representing the relationship between savings and consumption

#11

What is elasticity of demand?

The responsiveness of quantity demanded to changes in price

The ratio of price to quantity demanded

The proportion of income spent on a good or service

The percentage change in quantity demanded divided by the percentage change in income

#12

What is the difference between nominal GDP and real GDP?

Nominal GDP is adjusted for inflation, while real GDP is not adjusted for inflation

Nominal GDP is not adjusted for inflation, while real GDP is adjusted for inflation

Nominal GDP includes only the value of final goods and services, while real GDP includes the value of intermediate goods and services

Nominal GDP is measured in current prices, while real GDP is measured in constant prices

#13

What is the concept of utility in economics?

The measure of satisfaction or pleasure derived from consuming goods and services

The total value of goods and services produced in an economy

The ability of a good or service to satisfy human wants and needs

The total amount of money available in an economy

#14

What is the difference between a recession and a depression?

A recession is a mild economic downturn, while a depression is a severe and prolonged economic downturn

A recession is a severe economic downturn, while a depression is a mild economic downturn

A recession lasts longer than a depression

A depression is a temporary economic downturn, while a recession is a long-term economic downturn

#15

What is the concept of comparative advantage in international trade?

When a country can produce a good with a lower opportunity cost than another country

When a country can produce more of a good than another country

When a country has an absolute advantage in producing all goods compared to another country

When a country's exports exceed its imports

#16

What is the difference between absolute advantage and comparative advantage?

Absolute advantage is when one country can produce more of a good than another, while comparative advantage is when one country can produce a good at a lower opportunity cost

Absolute advantage is when one country can produce a good at a lower opportunity cost than another, while comparative advantage is when one country can produce more of a good than another

Absolute advantage is when one country can produce all goods more efficiently than another, while comparative advantage is when one country specializes in producing a specific good

Absolute advantage is a concept in macroeconomics, while comparative advantage is a concept in microeconomics

#17

What is the quantity theory of money?

A theory that states the quantity of money in circulation determines the level of prices

A theory that states the quantity of goods and services produced determines the level of prices

A theory that states the quantity of money demanded determines the level of prices

A theory that states the quantity of money supplied determines the level of prices

#18

What is the law of diminishing marginal utility?

As the quantity of a good consumed increases, the marginal utility derived from each additional unit decreases

As the quantity of a good consumed increases, the total utility derived from each additional unit increases

As the price of a good decreases, the quantity demanded increases

As the price of a good increases, the quantity supplied increases

#19

What is the difference between monetary base and money supply?

Monetary base includes only physical currency, while money supply includes physical currency and bank deposits

Monetary base includes physical currency and bank deposits, while money supply includes only physical currency

Monetary base is controlled by central banks, while money supply is controlled by commercial banks

There is no difference between monetary base and money supply

#20

What is the law of diminishing returns?

As more units of a variable input are added to a fixed input, the additional output gained from each additional unit of the variable input will eventually decrease

As more units of a variable input are added to a fixed input, the additional output gained from each additional unit of the variable input will increase

As more units of a fixed input are added to a variable input, the additional output gained from each additional unit of the fixed input will eventually decrease

As more units of a fixed input are added to a variable input, the additional output gained from each additional unit of the fixed input will increase

#21

What is a public good in economics?

A good that is rivalrous and excludable

A good that is rivalrous but non-excludable

A good that is non-rivalrous and excludable

A good that is non-rivalrous and non-excludable

Economics concept Quiz

What is inflation?

What is Gross Domestic Product (GDP)?

What is a budget deficit?

What is a monopoly?

What is the concept of opportunity cost?

What is a recession?

What is fiscal deficit?

What is the law of demand in economics?

What is the difference between fiscal policy and monetary policy?

What is the Phillips Curve?

What is elasticity of demand?

What is the difference between nominal GDP and real GDP?

What is the concept of utility in economics?

What is the difference between a recession and a depression?

What is the concept of comparative advantage in international trade?

What is the difference between absolute advantage and comparative advantage?

What is the quantity theory of money?

What is the law of diminishing marginal utility?

What is the difference between monetary base and money supply?

What is the law of diminishing returns?

What is a public good in economics?

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