#1
What does GDP stand for in economics?
Gross Domestic Product
ExplanationMeasure of a country's economic performance.
#2
What does the law of demand state in economics?
As price increases, quantity demanded decreases
ExplanationInverse relationship between price and quantity demanded.
#3
Which of the following is NOT a factor of production in economics?
Money
ExplanationMedium of exchange rather than a resource.
#4
What is the primary goal of a firm operating in a market economy?
Maximize profits
ExplanationOptimizing revenue while minimizing costs.
#5
What is the term used to describe the total value of all goods and services produced within a country in a given period?
Gross Domestic Product (GDP)
ExplanationSum of consumption, investment, government spending, and net exports.
#6
Which of the following is a characteristic of a perfectly competitive market?
Many buyers and many sellers
ExplanationMarket with no barriers to entry or exit.
#7
What is the concept of 'opportunity cost' in economics?
The cost of forgoing the next best alternative
ExplanationValue of the next best alternative when a decision is made.
#8
What is the main function of the Federal Reserve System in the United States?
Conduct monetary policy
ExplanationRegulate the nation's money supply and interest rates.
#9
In economics, what does the term 'inflation' refer to?
Increase in the general price level
ExplanationReduction in the purchasing power of money.
#10
Which of the following is a characteristic of monopolistic competition?
Substitute goods
ExplanationMany producers selling differentiated products.
#11
What is the formula to calculate total revenue?
Total Revenue = Price × Quantity
ExplanationIncome generated from the sale of goods or services.
#12
What is the concept of 'elasticity of demand' in economics?
The degree of responsiveness of quantity demanded to a change in price
ExplanationSensitivity of consumer demand to price changes.
#13
What is the concept of 'comparative advantage' in international trade?
The ability of a country to produce a good using fewer resources than another country
ExplanationBasis for specialization and trade among nations.
#14
What is the concept of 'perfectly elastic demand' in economics?
Demand that is unaffected by price changes
ExplanationHorizontal demand curve where quantity demanded changes infinitely with price.
#15
In economics, what is the term used to describe a good for which demand decreases as consumer income rises?
Inferior good
ExplanationGoods whose demand decreases as income increases.