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Questions and Answers
Which of the following best defines economic elasticity?
What characterizes a monopoly in the context of market structures?
What differentiates perfect competition from imperfect competition?
How is minimum wage defined in economic terms?
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What is an example of a characteristic of oligopoly?
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Which statement accurately describes unitary elasticity?
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In economic terms, what does market equilibrium signify?
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What is the labor force defined as in economics?
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Study Notes
Technology and Production
- Technology involves applying scientific knowledge to production methods, enhancing efficiency and output.
Market Equilibrium
- Market equilibrium is achieved when the quantity demanded equals the quantity supplied at a specific price, ensuring stability in the market.
Rent
- Rent is the monetary compensation paid for the use of land owned by a landowner.
Price Controls
- A price ceiling is a legally established maximum price for goods, typically set by the government to protect consumers.
Elasticity
- Elasticity measures how demand or supply responds to changes in price or other determinants.
- Elastic demand/supply occurs when a change in a determinant results in a greater proportional change in quantity, with an elasticity coefficient greater than 1.
- Inelastic demand/supply indicates a lesser proportional change, with an elasticity coefficient less than 1.
- Unitary elastic demand/supply is characterized by a proportional change in demand or supply equal to that of the determinant, yielding an elasticity coefficient of exactly 1.
Market Structure
- Market structure defines the competitive landscape where buyers and sellers operate.
- Perfect competition features many small buyers and sellers providing homogeneous goods, with no individual influence over price.
- Imperfect competition occurs when one or more conditions of perfect competition are missing.
- Monopoly features a single producer dominating the market, with no close substitutes available.
- Monopolistic competition includes many sellers offering differentiated, though not perfect, substitutes (e.g., automotive brands, fast food chains).
- Oligopoly consists of a few sellers responsible for significant production, with barriers to entry that limit new competitors.
Labor Force
- The labor force encompasses individuals aged 15 and older who are willing and capable of working, including both employed and actively job-seeking individuals.
Population
- Population refers to all inhabitants of a specific town, area, or country.
Wage and Minimum Wage
- Wage is a regular fixed payment from an employer to an employee, often disbursed daily or weekly.
- Minimum wage is the lowest permissible wage set by law, with penalties for employers who pay below this threshold.
Foreign Exchange
- The foreign exchange rate denotes the conversion rate of the Philippine peso into foreign currencies, such as the U.S. dollar.
Savings and Investment
- Savings represent income not spent on consumption or taxes, allowing individuals to store wealth.
- Investment relates to increasing the capital stock for future production, often involving the temptation to reduce current spending for potential gains later.
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Description
Test your knowledge on key economic principles such as market equilibrium, price ceilings, and elasticity. This quiz covers the application of scientific knowledge in production and the dynamics of supply and demand. Assess your understanding of these crucial economic concepts.
