Basic Economic Concepts (Review)

Basic Economic Concepts (Review)

Big Topics

• Basic Economic Concepts

• Law of Diminishing Marginal Utility

• Demand

Basic Economic Concepts

• What is economics?

• Scarcity

• Macroeconomics vs. Microeconomics

• Free goods vs. Economic goods

• Opportunity cost

• Three economic problems

• Types of Economic System

Demand

• Law of Diminishing Marginal Utility

• Demand and quantity demand

• Law of demand

• Demand schedule and curve

• Changes in Quantity Demand and Demand

• Factors Affecting Demand

• Types of Demand

Multiple Choice

What is the source of all the economic problems?

• unlimited resources

• unlimited wants

• limited resources

• limited wants

Multiple Choice

Scarcity is when the resources for satisfying human wants and needs are limited.

• TRUE

• FALSE

Multiple Choice

Economics is the study of how society satisfy their unlimited wants with limited resources.

• TRUE

• FALSE

Multiple Choice

What type of goods is the sea water?

• ECONOMIC GOODS

• FREE GOODS

Multiple Choice

What branch of economics that thoroughly discuss these topics: Gross Domestic Product, Gross National Product and Gross National Income?

• Microeconomics

• Macroeconomics

Multiple Choice

What branch of economics that studies the behavior of individuals and firms in making decisions regarding the allocation of scarce resources?

• Microeconomics

• Macroeconomics

Multiple Choice

Which of the following is the opportunity cost if I chose to study law?

• Law

• Medicine

The choice you DID NOT CHOOSE

Multiple Choice

A type of economic system wherein it is the government or ruler who makes most of the important decisions and solves the problems in the economy according to the central plan.

• Traditional economy

• Market economy

• Command economy

• Mixed economy

Multiple Choice

A type of economic system wherein economic decisions, such as the prices of goods and services, are guided by price signal determined by supply and demand.

• Traditional economy

• Market economy

• Command economy

• Mixed economy

Multiple Choice

The law of demand states that, as the price increases the quantity demand _________ but when the price _________ the quantity demand increases.

• decreases; decreases

• decreases; increase

• increases; decreases

• increases; increases

Multiple Choice

In the law of demand, price and quantity demand has a positive relationship.

• True

• False

Multiple Choice

Does this demand schedule follows the law of demand?

• Yes

• No

Multiple Choice

Why do you think the schedule follows the law of demand?

• Positive relationship between price and quantity demand

• Inverse relationship of price and quantity demand

Multiple Choice

What does this graph tells us?

• Change in demand

• Change in quantity demand

• Excess demand

• Market equilibrium

movement from one point to another in the same demand curve

Multiple Choice

What does this graph tells us?

• Change in quantity demand

• Absolute price is the factor of change

• Change in demand

• There is no market equilibrium at all

shift of demand curve from one demand curve to another

Multiple Choice

What type of change is the movement from Point A to Point B?

• Change in demand

• Change in quantity demand

Multiple Choice

What type of change is the shift of curve from D1 to D2?

• Change in demand

• Change in quantity demand

shift of demand curve from one demand curve to another

Multiple Choice

Based on the shift of the curve, the consumer's new demand is:

• decreased

• increased

• diminished

• declined

Increasing: left to right

Multiple Choice

The demand curve is upward slope from left to right.

• True

• False

Demand curves are downward sloping from left to right

Questions?