#1
Which of the following is a characteristic of oligopoly?
Few sellers, many buyers
ExplanationOligopoly: Market structure with few dominant sellers and many buyers.
#2
What is a demand curve?
A graphical representation of the relationship between price and quantity demanded
ExplanationDemand curve: Shows how quantity demanded changes with price.
#3
Which of the following is a determinant of supply?
Cost of production
ExplanationSupply determinant: Cost of production influences supply levels.
#4
Which of the following is NOT a characteristic of a perfectly competitive market?
Barriers to entry
ExplanationPerfect competition: No barriers to entry, many buyers and sellers.
#5
What is the law of demand?
As the price of a good decreases, the quantity demanded decreases
ExplanationLaw of demand: Price drop increases quantity demanded.
#6
What is the law of supply?
As the price of a good increases, the quantity supplied increases
ExplanationLaw of supply: Price increase leads to increased quantity supplied.
#7
In economics, what is utility?
The satisfaction or pleasure derived from consuming a good or service
ExplanationUtility: Satisfaction or pleasure from consuming goods or services.
#8
What is price elasticity of demand?
A measure of the responsiveness of quantity demanded to a change in price
ExplanationPrice elasticity of demand: Measures how demand changes with price.
#9
What is the 'Tragedy of the Commons'?
A situation where individual users exploit shared resources to the detriment of the common good
ExplanationTragedy of the Commons: Exploitation of shared resources harming common good.
#10
What does the term 'invisible hand' refer to in economics?
The automatic self-regulation of markets to allocate resources efficiently
ExplanationInvisible hand: Market forces self-regulating for efficient resource allocation.
#11
Which of the following is NOT a characteristic of perfect competition?
Barriers to entry
ExplanationPerfect competition: No barriers to entry, many buyers and sellers.
#12
What is the difference between microeconomics and macroeconomics?
Microeconomics focuses on individual markets, while macroeconomics focuses on the economy as a whole
ExplanationMicro vs. macro: Micro: individual markets, Macro: entire economy.
#13
What is a monopolistic competition market structure characterized by?
A few firms selling similar but differentiated products
ExplanationMonopolistic competition: Few firms, similar but differentiated products.
#14
What is the law of diminishing marginal utility?
As the quantity of a good consumed increases, the total utility derived from each additional unit decreases
ExplanationDiminishing marginal utility: Satisfaction decreases as consumption increases.
#15
What is a cartel?
A group of firms that collude to restrict output and raise prices
ExplanationCartel: Firms collude to limit production and increase prices.
#16
What is a supply shock?
A sudden decrease in the supply of a product
ExplanationSupply shock: Abrupt reduction in product availability.
#17
What is a monopolist's marginal revenue?
The change in total revenue when one additional unit of output is sold
ExplanationMonopolist's marginal revenue: Revenue change from one more unit sold.
#18
In a monopoly, where does the demand curve lie in relation to the marginal revenue curve?
The demand curve lies above the marginal revenue curve
ExplanationMonopoly: Demand curve higher than marginal revenue curve.
#19
What is a natural monopoly?
A monopoly that arises due to economies of scale, where one firm can produce the entire market output at the lowest cost
ExplanationNatural monopoly: One firm due to cost efficiencies at large scale.