Principles of Business and Economic Management Quiz

Perfect competition involves many buyers and sellers, identical products, free entry and exit, and perfect information.

Consumers demand more of a good as its price decreases, and vice versa.

Total revenue is the product of the price of a good and the quantity sold.

Microeconomics focuses on individual economic units, such as consumers and firms, and their decision-making.

In a command economy, the government centrally plans and controls economic activities.

Central banks manage money supply, control interest rates, and supervise banks to ensure monetary stability and economic growth.

GDP is the sum of consumption, investment, government spending, and net exports (exports minus imports).

Money is a medium of exchange, not a factor of production; land, labor, and capital are the primary factors.

In monopolistic competition, firms have some control over prices, unlike pure competition where they are price takers.

Fiscal policy involves government decisions on spending, taxation, and debt to achieve economic goals.

Opportunity cost is the value of the best alternative foregone when a decision is made.

Elasticity of demand measures how sensitive quantity demanded is to changes in price.

Monetary policy is managed by central banks and involves influencing money supply and interest rates, while fiscal policy is controlled by governments, focusing on spending and taxation.

The Phillips Curve illustrates the inverse relationship between inflation and unemployment.

The Tragedy of the Commons occurs when individuals exploit a shared resource, leading to its depletion due to lack of regulation and cooperation.