PHILIPPINE ECONOMICS

Which school of thought in economics emphasizes the importance of free markets and minimal government intervention?

• Classical Economics
• Keynesian Economics
• Neoclassical Economics
• Marxist Economics

Answer explanation

Classical Economics Rationalization: Classical economics emerged in the late 18th to 19th century and advocates for self-regulating markets with minimal government interference.

According to the law of comparative advantage, countries can benefit from international trade by:

• Specializing in goods with lower opportunity cost
• Maximizing their production of all goods
• Implementing protectionist trade policies
• Restricting imports to protect domestic industries

Answer explanation

Specializing in goods with lower opportunity cost Rationalization: The law of comparative advantage, proposed by David Ricardo, states that countries should specialize in producing goods where they have a lower opportunity cost compared to other countries.

Who is considered the father of economics and capitalism?

• Adam Smith
• David Ricardo
• Thomas Malthus
• Alfred Marshall

Answer explanation

Adam Smith Rationalization: Adam Smith is often referred to as the father of economics and capitalism due to his influential book "The Wealth of Nations" and his advocacy for free markets and limited government intervention.

Which economist developed the law of diminishing marginal utility?

• Alfred Marshall
• Paul Samuelson
• John Maynard Keynes
• Karl Marx

Answer explanation

Alfred Marshall Rationalization: Alfred Marshall introduced the law of diminishing marginal utility, which states that as consumption increases, the additional satisfaction or utility derived from each additional unit decreases.

Who is known as the father of communism?

• Adam Smith
• David Ricardo
• Thomas Malthus
• Karl Marx

Answer explanation

Karl Marx Rationalization: Karl Marx is considered the father of communism and is known for his influential works, including "Das Kapital" and "The Communist Manifesto."

Microeconomics focuses on the behavior and activities of:

• The economy as a whole
• Individual economic units
• Government interventions
• International trade

Answer explanation

Individual economic units Rationalization: Microeconomics analyzes the behavior and decisions of specific economic units, such as individuals, households, and firms.

Which factor of production refers to the productive services embodied in human physical efforts and skills?

• Land
• Labor
• Capital
• Entrepreneurial ability

Answer explanation

Labor Rationalization: Labor represents the human physical efforts, skills, and productive services used in the production of goods and services.

Which economic system is characterized by private ownership, profit motive, competition, and limited government interference?

• Market Economy
• Command Economy
• Mixed Economy
• Communism

Answer explanation

Market Economy Rationalization: A market economy, also known as capitalism, is based on private ownership of the means of production, profit maximization, competition, and limited government interference.

Which economist is considered the father of macroeconomics?

• Adam Smith
• John Maynard Keynes
• David Ricardo
• Karl Marx

Answer explanation

John Maynard Keynes Rationalization: John Maynard Keynes is known as the father of macroeconomics for his influential work, "The General Theory of Employment, Interest, and Money."

Which category of market is characterized by a higher degree of structure and formalization?

• Organized Markets
• Informal Markets
• Less Organized Markets
• Black Markets

Answer explanation

Organized Markets Rationalization: Organized markets have a higher degree of structure, specific time and place of transaction, and formal rules and regulations that govern the exchange of goods and services. Examples include stock exchanges, commodity exchanges, and futures exchanges.