Basic Concepts of Economics Quiz

Study Notes

The video discusses basic concepts of economics including needs, wants, demand, supply, demand curve, supply curve, market types, market equilibrium, utility, consumption, consumer surplus, law of diminishing marginal utility, price, value, GDP, GNP, factors of production, national income, and per capita income.
Needs are the state of self-deprivation in an individual and are the starting point of marketing, encompassing physiological, social, cultural, and individual aspects.
Wants are the desires for specific satisfiers of needs and are influenced by culture, social class, and individual personality.
Demand is human wants backed by the ability and willingness to buy, influenced by factors like price and quality.
Supply is the amount of commodity that sellers are willing and able to offer for sale at a certain price and time.
The law of demand states that as the price decreases, consumer demand increases, and vice versa.
The law of supply states that as the price increases, the quantity of goods or services offered by suppliers also increases.
Equilibrium is where demand and supply intersect, determining the price and quantity bought and sold in a market.
Excess demand (shortage) occurs when quantity demanded exceeds quantity supplied at a given price, while excess supply (surplus) happens when quantity supplied exceeds quantity demanded.
Consumer surplus is the difference between what consumers are willing to pay and what they actually pay for a product.
Producer surplus is the difference between the selling price and the economic cost of production.
Total surplus is the sum of consumer surplus and producer surplus, representing total economic welfare.
The law of diminishing marginal utility explains how the value of commodities decreases as more are consumed, impacting consumer willingness to pay.