#1
What is the law of demand in economics?
As the price increases, the quantity demanded decreases.
ExplanationInverse relationship between price and quantity demanded.
#2
What is the difference between a normal good and an inferior good?
Normal goods are in demand regardless of income changes, while inferior goods are demanded less as income increases.
ExplanationIncome effect on demand.
#3
What is the law of diminishing marginal utility?
The more you consume a good, the lower the satisfaction derived from each additional unit.
ExplanationDecreasing satisfaction with each additional unit consumed.
#4
What is the concept of a price floor in economics?
A minimum price set by the government, above which a good or service cannot be sold.
ExplanationGovernment-set minimum price.
#5
What is the concept of market failure?
A situation where markets do not allocate resources efficiently, leading to undesirable outcomes.
ExplanationInefficient resource allocation.
#6
In the context of market equilibrium, what happens when there is excess demand?
Prices increase
ExplanationPrice adjustment to balance demand and supply.
#7
What is the concept of elasticity of demand?
It measures the responsiveness of quantity demanded to changes in price.
ExplanationSensitivity of quantity demanded to price changes.
#8
What does the term 'utility' mean in economics?
The satisfaction or pleasure derived from consuming a good or service.
ExplanationMeasure of satisfaction.
#9
What is a price ceiling in the context of government intervention in markets?
A maximum price set by the government, below which a good or service cannot be sold.
ExplanationGovernment-set maximum price.
#10
In the context of market structure, what characterizes an oligopoly?
A small number of sellers with homogeneous products.
ExplanationMarket dominated by a few firms.
#11
In the context of market structures, which type is characterized by a large number of sellers and buyers with homogeneous products?
Perfect competition
ExplanationMarket with many identical competitors.
#12
What is the Nash Equilibrium in game theory?
A situation where no player has an incentive to change their strategy given the other players' strategies.
ExplanationStable strategy where no player benefits from unilateral change.
#13
In macroeconomics, what is the Phillips Curve relationship?
There is a negative relationship between inflation and unemployment.
ExplanationInverse correlation between inflation and unemployment.
#14
What is the Tragedy of the Commons in the context of resource management?
A situation where common resources are overused and depleted due to individual self-interest.
ExplanationOveruse of shared resources.
#15
In international trade, what is a trade surplus?
When a country's exports exceed its imports.
ExplanationExcess of exports over imports.