#1
What does the law of supply state in economics?
As the price of a good increases, the quantity supplied increases.
ExplanationPrice increase leads to increased supply.
#2
What is the concept of equilibrium price in economics?
The price at which quantity demanded equals quantity supplied.
ExplanationPrice balance between demand and supply.
#3
What is the concept of producer surplus in economics?
The difference between the minimum price a seller is willing to accept and the price actually received.
ExplanationDifference between actual and minimum selling price.
#4
In economics, what does the term 'market equilibrium' refer to?
The point where quantity demanded equals quantity supplied.
ExplanationBalance between quantity demanded and supplied.
#5
Which of the following statements best describes the law of supply and demand?
As demand increases, supply increases.
ExplanationPositive correlation between demand and supply.
#6
What is the concept of a subsidy in economics?
A payment made by the government to producers
ExplanationGovernment support to producers.
#7
Which of the following statements accurately describes the law of demand?
As price decreases, quantity demanded increases.
ExplanationInverse relationship between price and demand.
#8
Which of the following factors can cause a shift in the supply curve?
Changes in technology
ExplanationTechnological advancements affect supply curve.
#9
What is the concept of elasticity of supply in economics?
It measures the responsiveness of quantity supplied to changes in price.
ExplanationQuantity supplied responsiveness to price changes.
#10
Which of the following scenarios would lead to an increase in market supply?
A decrease in the price of inputs used in production
ExplanationInput price decrease increases market supply.
#11
What is the distinction between a change in supply and a change in quantity supplied in economics?
A change in supply refers to a shift of the supply curve, while a change in quantity supplied refers to movement along the curve.
ExplanationShift versus movement along the supply curve.
#12
What is the effect of a decrease in supply on equilibrium price and quantity in a market?
Equilibrium price increases; equilibrium quantity decreases.
ExplanationPrice rises, quantity falls due to supply decrease.
#13
What does the law of diminishing returns state in relation to production?
As more units of a variable input are added to fixed inputs, the additional output produced eventually decreases.
ExplanationDecreasing marginal returns with additional inputs.
#14
Which of the following would likely cause a shift to the left in the supply curve for a product?
An increase in the price of inputs used in production
ExplanationInput price increase shifts supply curve left.
#15
In economics, what is a perfectly elastic supply curve?
A supply curve that is horizontal
ExplanationPerfectly responsive supply to price changes.
#16
In economics, what is the concept of a perfectly inelastic supply curve?
A supply curve that is vertical
ExplanationSupply unresponsive to price changes.
#17
What is the concept of cross-price elasticity of demand?
It measures the responsiveness of quantity demanded of one good to changes in the price of another good.
ExplanationDemand responsiveness between two goods' prices.