Microeconomics Multiple choice, Riddles and Whats the question?

What is the basic economic problem?

• Limited resources and unlimited wants

• Unlimited resources and limited wants

• Unlimited resources and unlimited wants

What does the law of demand state?

• As price increases, quantity demanded increases

• As price decreases, quantity demanded decreases

• As price increases, quantity demanded decreases

What is the concept of opportunity cost?

• The cost of imported goods

• The value of the next best alternative forgone

• The total cost of production

Which of the following is a factor of production?

• Money

• Land

• Goods

What is the difference between a monopoly and perfect competition?

• A monopoly has many firms, while perfect competition has only one firm

• A monopoly has one firm, while perfect competition has many firms

• A monopoly and perfect competition have the same number of firms

What is price elasticity of demand?

• A measure of how much demand changes in response to a change in price

• The amount of money consumers are willing to spend on a product

• The change in quantity demanded over a period of time

What is a subsidy?

• A tax imposed on imported goods

• Financial assistance given by the government to businesses

• The cost of producing goods and services

What does GDP stand for?

• Gross Domestic Production

• Gross Domestic Profit

• Gross Domestic Product

What is inflation?

• A decrease in the general price level of goods and services

• An increase in the general price level of goods and services

• No change in the general price level of goods and services

What is the role of the central bank in an economy?

• To regulate fiscal policy

• To control interest rates and money supply

• 1. To set prices for goods and services