Economics Terms Quiz

What is the definition of absolute advantage?

• When a country is able to produce more output than other countries using the same input of factors of production.

• When a country is able to produce goods at a lower opportunity cost of resources than another country.

• When a buyer and seller do not have the same information, causing a transaction to take place based upon uneven terms.

• When the level of output where marginal cost is equal to average revenue.

How is absolute poverty measured?

• In terms of the basic need for survival.

• In terms of the amount of income a person needs to have in order to stay alive.

• In terms of the total spending in an economy consisting of consumption, investment, government expenditure, and net exports.

• In terms of the total amount of domestic goods and services supplied by businesses and the government.

What is actual growth?

• When a buyer and seller do not have the same information, causing a transaction to take place based upon uneven terms.

• When previously unemployed factors of production are brought in to use.

• The level of output where marginal cost is equal to average revenue.

• Where the marginal social cost of producing a good is not equal to the marginal social benefit of the good to society.

What is adverse selection?

• When a country is able to produce more output than other countries using the same input of factors of production.

• When a buyer and seller do not have the same information, causing a transaction to take place based upon uneven terms.

• The total spending in an economy consisting of consumption, investment, government expenditure, and net exports.

• A curve showing the relationship between the average price level and real GDP.

What is aggregate demand?

• When a country is able to produce more output than other countries using the same input of factors of production.

• In terms of the basic need for survival.

• The total spending in an economy consisting of consumption, investment, government expenditure, and net exports.

• The total amount of domestic goods and services supplied by businesses and the government.

What is the definition of aggregate demand curve?

• When a country is able to produce more output than other countries using the same input of factors of production.

• In terms of the basic need for survival.

• A curve showing the relationship between the average price level and real GDP.

• The total amount of domestic goods and services supplied by businesses and the government.

What is aggregate supply (AS)?

• When a country is able to produce more output than other countries using the same input of factors of production.

• In terms of the basic need for survival.

• The total spending in an economy consisting of consumption, investment, government expenditure, and net exports.

• The total amount of domestic goods and services supplied by businesses and the government.

What is allocative efficiency?

• The level of output where marginal cost is equal to average revenue.

• Where the marginal social cost of producing a good is not equal to the marginal social benefit of the good to society.

• Anchors are mental reference points, relating to ideas or values, which are used to make decisions.

• Policies that are intended to regulate the market share of an individual company in order to enforce competition.

What is allocative inefficiency?

• When a country is able to produce more output than other countries using the same input of factors of production.

• In terms of the basic need for survival.

• Where the marginal social cost of producing a good is not equal to the marginal social benefit of the good to society.

• Anchors are mental reference points, relating to ideas or values, which are used to make decisions.

What is anchoring?

• When a country is able to produce more output than other countries using the same input of factors of production.

• In terms of the basic need for survival.

• Anchors are mental reference points, relating to ideas or values, which are used to make decisions.

• Policies that are intended to regulate the market share of an individual company in order to enforce competition.