#1
What is the law of demand in economics?
As price decreases, quantity demanded increases.
ExplanationInverse relationship between price and quantity demanded.
#2
What does GDP stand for in economics?
Gross Domestic Product
ExplanationTotal value of goods and services produced within a country.
#3
What is the law of supply in economics?
As price increases, quantity supplied increases.
ExplanationDirect relationship between price and quantity supplied.
#4
What is a tariff in international trade?
A tax on imports
ExplanationTax imposed on imported goods.
#5
Which market structure is characterized by a single seller with complete control over supply and price?
Monopoly
ExplanationSingle seller dominance in the market.
#6
What is the primary goal of fiscal policy?
To stabilize the economy through government spending and taxation
ExplanationGovernment actions to manage economy.
#7
What is the term for the total value of all goods and services produced within a country's borders in a specific period?
Gross Domestic Product (GDP)
ExplanationEconomic output within a nation's borders.
#8
What is the primary goal of monetary policy?
To influence interest rates
ExplanationCentral bank's control over interest rates.
#9
What is the term for the percentage of the labor force that is unemployed and actively seeking employment?
Unemployment rate
ExplanationRate of jobless actively seeking work.
#10
Which of the following is NOT a characteristic of perfect competition?
Barriers to entry
ExplanationPerfect competition entails no barriers to entry.
#11
Which of the following is NOT a function of money in an economy?
Barter facilitation
ExplanationMoney eliminates the need for barter.
#12
Which of the following is NOT a determinant of demand?
Cost of production
ExplanationCost of production affects supply, not demand.
#13
What is comparative advantage in international trade?
The ability of a country to produce all goods at a lower opportunity cost than another country
ExplanationProducing with less sacrifice of alternative goods.
#14
What is the opportunity cost of a decision?
The value of the next best alternative forgone
ExplanationValue sacrificed for the chosen option.
#15
What is the formula for calculating elasticity of demand?
Percentage change in quantity demanded divided by percentage change in price
ExplanationMeasure of responsiveness of quantity demanded to price change.
#16
Which of the following is NOT a characteristic of monopolistic competition?
Price taker
ExplanationFirms have some control over pricing.
#17
What is the difference between a consumer and a producer surplus?
Consumer surplus is the difference between the price a consumer is willing to pay and the actual price paid, while producer surplus is the difference between the price a producer is willing to sell for and the actual price received.
ExplanationExcess benefit consumers and producers gain.
#18
In economics, what is the term 'elasticity' referring to?
The sensitivity of quantity demanded or supplied to changes in price or income
ExplanationExtent of response to price or income changes.
#19
Which of the following is NOT a tool of monetary policy?
Fiscal stimulus
ExplanationFiscal policy tool, not monetary.
#20
What is the concept of absolute advantage in international trade?
The ability of a country to produce goods at a lower absolute cost than another country
ExplanationSuperior efficiency in production.
#21
Which of the following is NOT a type of unemployment?
Market unemployment
ExplanationNo standard term as 'market unemployment.'
#22
What is the concept of a price ceiling?
A government-imposed limit on the maximum price that can be charged for a good or service
ExplanationLegal restriction on maximum prices.
#23
What is the economic concept defined as the additional satisfaction or utility that a consumer derives from consuming an additional unit of a good or service?
Marginal utility
ExplanationExtra benefit gained from consuming one more unit.
#24
What does the term 'invisible hand' refer to in economics?
The self-regulating nature of markets
ExplanationMarket forces guiding resource allocation.
#25
What is the law of diminishing marginal returns?
As more of a variable input is added to a fixed input, the marginal product of the variable input eventually declines
ExplanationDecrease in additional output from extra input.