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Introduction to Economics (Week 1 to 5) Flashcards | StudBud
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Introduction to Economics (Week 1 to 5)
Introduction to Economics (Week 1 to 5)
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Questions
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Answers
1
What is the basic economic problem?
Deflation
Inflation
Scarcity
Opportunity cost
2
Entrepreneurship is one of the factors of production.
False
True
3
What is the main focus of microeconomics?
International trade
The economy as a whole
Government interventions
Individual agents and markets
4
What is opportunity cost?
The cost of marketing
The cost of production
The value of what is gained
The value of what is given up
5
What is a need in economics?
Basic
Optional
Luxury
Desire
6
What is the impact of monopoly on consumers?
Higher prices
Choice
Ease of access
Lower prices
7
When demand increases, the demand curve shifts
Left
Right
8
What happens if price is above equilibrium?
Shortage
None of the above
Surplus
Stability
9
What happens to price if demand exceeds supply?
Price goes up
Price is undefined
Price goes down
Price stays the same
10
What is a characteristic of monopolistic competition?
Barriers to entry
Identical product
Product differentiation
Few sellers
11
What's the definition of labor in economics?
Natural resources
Manufacturing tools
Human effort
Anything with financial value
12
What is a characteristic of perfect competition?
Few sellers
Price taker
Product differentiation
Barriers to entry
13
Does price floor create surplus?
False
True
14
Is a change in production costs a factor affecting supply?
False
True
15
What does PED measure?
Sensitivity of demand
Price changes
Income changes
Quantity Q changes
16
Is equilibrium always present?
False
True
17
Define Supply in economics.
The willingness and ability of a producer to produce and sell a product.
The desire to have a good or service and the ability to pay for it.
18
Is a competitive market structure good for consumers?
True
False
19
If prices increase and demand falls, pricing is said to be...
elastic
inelastic
20
Microeconomics focuses on government intervention.
True
False
21
Are price ceilings always effective?
True
False
22
What is the formula for Income Elasticity of Demand?
% Change in Income/% Change in Quantity Demanded
% Change in Quantity Supplied/% Change in Income
% Change in Quantity Demanded/% Change in Income
% Change in Income/% Change in Quantity Supplied
23
A product with low income elasticity is a necessity
True
False
