#1
What is inflation?
An increase in the general price level of goods and services
ExplanationRise in overall prices of goods and services
#2
What is Gross Domestic Product (GDP)?
Total value of all goods and services produced within a country in a specific period
ExplanationSum of all goods and services produced within a country
#3
What is a budget deficit?
When government spending exceeds government revenue in a given period
ExplanationGovernment spending more than it earns in a period
#4
What is a monopoly?
A market structure with one seller and many buyers
ExplanationSingle seller dominating market with multiple buyers
#5
What is the concept of opportunity cost?
The cost of the next best alternative foregone when a decision is made
ExplanationCost of choosing one option over another
#6
What is a recession?
A period of declining economic activity characterized by falling GDP and rising unemployment
ExplanationEconomic downturn with falling GDP and rising unemployment
#7
What is fiscal deficit?
The excess of government expenditure over government revenue
ExplanationGovernment spending surpassing revenue
#8
What is the law of demand in economics?
As price decreases, demand increases
ExplanationInverse relationship between price and demand
#9
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
ExplanationGovernment's vs central bank's actions on spending, taxes, money supply, and interest rates
#10
What is the Phillips Curve?
A curve representing the relationship between inflation and unemployment
ExplanationTrade-off between inflation and unemployment rates
#11
What is elasticity of demand?
The responsiveness of quantity demanded to changes in price
ExplanationHow demand changes with price variations
#12
What is the difference between nominal GDP and real GDP?
Nominal GDP is not adjusted for inflation, while real GDP is adjusted for inflation
ExplanationGDP with vs without inflation adjustments
#13
What is the concept of utility in economics?
The measure of satisfaction or pleasure derived from consuming goods and services
ExplanationSatisfaction or pleasure from consuming goods and services
#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
ExplanationSeverity and duration of 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
ExplanationAbility to produce at lower opportunity cost than others
#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
ExplanationProducing more vs producing at lower opportunity cost
#17
What is the quantity theory of money?
A theory that states the quantity of money in circulation determines the level of prices
ExplanationMoney quantity influencing price levels
#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
ExplanationDecreasing additional satisfaction with more consumption
#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
ExplanationPhysical currency only vs physical currency and bank deposits
#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
ExplanationDecrease in additional output with more variable input
#21
What is a public good in economics?
A good that is non-rivalrous and non-excludable
ExplanationNon-rivalrous and non-excludable good